Inventory Turnover

Inventory turnover is a ratio that shows how many times a business sells and replaces its stock during a given period. The most common calculation divides the cost of goods sold over the period by the average inventory value. The result reflects how quickly products move off the shelf and how long capital stays tied up in stock.

This ratio matters for retail and wholesale businesses, because a high turnover usually signals healthy demand and efficient stock management, while a low turnover can point to excess inventory, slow-moving items, or cash locked into goods. For example, if the annual cost of goods sold is ₺600,000 and the average inventory value is ₺100,000, the inventory turnover is 6, meaning the stock was replenished on average six times during the year. Tracking turnover by product, category, and period helps with planning order quantities and spotting dead stock early. To run this calculation on accurate, up-to-date figures, using inventory management software lets you track movements and costs automatically. For sector-specific needs, you can explore the market inventory software solution.