Inventory KPI Calculator

Inventory KPIs show how efficiently your warehouse is working. Four metrics are enough to see whether capital is tied up, how long materials are sitting, what storage costs, and how often shortages occur.

• Turnover rate = Annual consumption / Avg. inventory value
• Storage days = 365 / Turnover rate
• Holding cost rate = Storage costs / Avg. inventory value × 100
• Stockout rate = Shortfall orders / Total orders × 100

How do you read the results?

• Turnover rate below 3 for standard materials: capital is tied up.
• Storage days above 90: material is sitting too long.
• Holding cost rate above 30%: storage is too expensive.
• Stockout rate above 5%: systemic reorder problem.

Note: The calculator assumes steady annual consumption; for highly variable volumes, quarterly averages are more accurate. Calculate per material group or A-item where possible instead of for the whole business, otherwise fast movers mask dead stock. The benchmarks apply to standard materials; specialty materials with long lead times normally have lower values.