How long will your current stock last? Calculate days of inventory and when to reorder.
Inventory Days (also called Days of Inventory or Days Sales of Inventory) tells you how many days your current stock will last at your recent selling pace. The formula is Inventory Days = Current stock on hand / Average daily units sold. To know when to reorder, subtract your supplier's lead time in days from inventory days, so you place the order before you run out.
A kirana store has 600 units of a biscuit SKU and sells about 30 units a day, so Inventory Days = 600 / 30 = 20 days of cover. If the distributor takes 4 days to deliver, the store should reorder when roughly 4 days of stock (about 120 units) remain, i.e. around day 16.
It depends on the category. Fast-moving grocery and FMCG often run 7-21 days, while apparel or electronics may hold 45-90 days. Lower days free up cash, but too low risks stockouts.
Take total units sold over a recent period and divide by the number of days, for example 900 units in 30 days = 30 units/day. Use a period that reflects normal demand, not a festival spike.
Yes. Seasonal peaks such as Diwali, Rakhi, or wedding season can multiply daily sales, so build a higher buffer and reorder earlier for those SKUs.
Inventory days measures how long stock lasts; the reorder point is the stock level at which you should place a new order, calculated as average daily sales multiplied by supplier lead time, plus a safety buffer.
Commmerce tracks days of inventory in real-time and auto-generates reorder requests.
See Inventory Management
