Inventory Turnover Predictor
Inventory Turnover Predictor estimates turnover ratio, days to sell, and efficiency from COGS and inventory value for optimized inventory management.
Formulas Used in Inventory Turnover Predictor
The calculator uses the following formulas to estimate inventory turnover:
Inventory Turnover Ratio:
\\[ T_r = \frac{C}{I} \\]Days to Sell Inventory:
\\[ D_s = \frac{P}{T_r} \\]Inventory Efficiency Score:
\\[ S = \min\left(100 \cdot \frac{T_r}{T_{\text{max}}}, 100\right) \\]Where:
- \\( T_r \\): Inventory turnover ratio (times per period)
- \\( C \\): Cost of goods sold (USD)
- \\( I \\): Average inventory value (USD)
- \\( D_s \\): Days to sell inventory (days)
- \\( P \\): Sales period (days)
- \\( S \\): Inventory efficiency score (%)
- \\( T_{\text{max}} \\): Maximum reference turnover ratio (10)
Example Calculations
Example 1: Low Turnover (Slow-Moving Inventory)
Input: Cost of Goods Sold = 50000 USD, Average Inventory Value = 25000 USD, Sales Period = 365 days
Result: Turnover Ratio: 2 times, Days to Sell: 182.5 days, Efficiency Score: 20%
Example 2: Moderate Turnover (Standard Retail)
Input: Cost of Goods Sold = 100000 USD, Average Inventory Value = 20000 USD, Sales Period = 365 days
Result: Turnover Ratio: 5 times, Days to Sell: 73 days, Efficiency Score: 50%
Example 3: High Turnover (Fast-Moving Goods)
Input: Cost of Goods Sold = 200000 USD, Average Inventory Value = 10000 USD, Sales Period = 365 days
Result: Turnover Ratio: 20 times, Days to Sell: 18.25 days, Efficiency Score: 100%