Quick Summary: The Stock Turns KPI projects how many times current stock value will sell through over the next 12 months, assessing working capital efficiency and inventory flow.
Why Stock Turns Matter
Stock Turns measure how often your total inventory is expected to convert back into sales within a year and is a critical measure of how efficiently your capital is being used. It answers the question: How quickly is my inventory investment generating revenue?
High Stock Turns indicate that inventory is moving quickly and your capital is being used efficiently.
Low Stock Turns suggest that stock is not selling fast enough, which ties up working capital and increases the risk of excess or obsolete items.
Stock Turns vs. Days of Cover
To understand Stock Turns, it is helpful to see its relationship with another metric: Days of Cover (also known as Days on Hand).
Days of Cover: The number of days your current stock on hand is expected to last based on forecasted demand.
Days of Cover = (Stock Value ÷ Average 12-Month Demand Value at Cost) × 30
Stock Turns: The number of times you would sell your Days on hand value over a full year.
Stock Turns = 365 ÷ Days of Cover
They are the inverse of each other. For example:
If you have 90 days of cover, your stock turn is approximately 4 (calculated as 365 ÷ 90).
If you reduce your days of cover to 45, your stock turn increases to approximately 8.
A positive outcome is when the projected stock turn at the end of a period is higher than the stock turn at the beginning. This means your inventory is moving faster and your capital is being used more efficiently.
Understanding the Stock Turns Panel
On the Dashboard, the Stock Turns panel displays:
Turns value: The number of times your current stock value is projected to sell through in the next 12 months.
Weighted cover: The number of days of stock on hand, adjusted for demand at cost. This is the inverse of stock turns and provides context for slow or fast movement.
Weighted cover = (Days of cover ÷ 365) × Stock value
Trend line: A visual indication of whether your inventory turnover is improving or declining.
Your goal: To increase your Stock Turns over time by improving demand accuracy, reducing excess stock, and managing supplier constraints effectively.
The Stock Turns KPI shows the historical trend of both your achieved and target fill rates. To view how your Fill Rate, Stock Holding, and other KPIs are expected to change based on current forecasts and policy settings, use the Stock Projection feature.
➜ For more on this topic, read: Stock Projection Feature
Interpreting Stock Turns in Context
Stock Turns do not exist in isolation. They must be viewed together with Stock Holding and Fill Rate to provide a balanced picture of performance.
A higher Stock Turn ratio is desirable, but only if service levels remain consistent.
If turns increase because stock levels have been reduced too aggressively, the Fill Rate may drop, resulting in lost sales.
How To: Interpret Stock Turns on the Dashboard
How To: Drill into Stock Turns for Individual Items
Stock Projection Feature
➜ Read: Stock Projection Feature
⚠️ Watchouts
Under-buying risk: While high stock turns are generally desirable, a turn rate that is too high may indicate you are under-buying and at risk of frequent stockouts, which can harm your fill rate and lead to lost sales.
💡 Tips
Focus on quick wins: Use the Top 5 list to identify items with high weighted cover and investigate their demand, policies, or lifecycle status.
Cross-KPI context: Review Stock Turns together with Stock Holding and Fill Rate KPIs for a complete understanding of service and efficiency trade-offs.
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