What is days of inventory?
Days of inventory links your stock to your sales. 600 units on the shelf says little; 60 days of inventory says something. In the Commerce Intelligence Model this sits at the core: demand against stock. Is the right stock ready for what is being sold?
How do you calculate it?
Divide your stock by your average sales per day.
Example: you have 600 units in stock and sold 300 in the last 30 days. That is 10 a day, so your stock lasts 60 days.
Inventory turnover is the same number the other way round: how often your stock turns over in a year. At 60 days of inventory that is about 6 times.
What to watch out for
Look per product, not per category. An average hides exactly the products that are almost gone and the products that barely sell.
Also put days of inventory next to your lead time. If your stock lasts 20 days and reordering takes 30 days, you are too late. And do not advertise products that will run out in a few days.
In Ecommy
Ecommy puts demand against stock, per product and per location, from your shop, marketplaces and inventory system.