What is inventory turn?
SHORT ANSWER
Inventory turn is how many times you sell through your average inventory in a period — COGS divided by average inventory value.
Turn measures velocity. Four turns a year means your shelf empties and refills roughly every quarter.
Turn multiplied by margin is what actually earns. A 25% margin turning eight times a year beats a 45% margin turning twice.
For example
COGS $130,000 ÷ average inventory $32,500 = 4 turns per year.
Why it matters
Velocity, not margin, is what turns working capital into a bigger business.
The mistake to avoid
Chasing the highest-margin load and letting it sit for six months.
LAST UPDATED 2026-09-16 · REVIEWED BY REGISTIX OPERATIONS TEAM