Free valuation & inventory tool
Inventory Turnover Ratio Calculator
The inventory turnover ratio is cost of goods sold divided by average inventory. If a practice sold $180,000 of neurotoxin at cost in a year and held $18,000 of it on average, turnover is 10 times a year. Days inventory outstanding is average inventory divided by COGS, times the days in the period, so the same numbers give 36.5 days on hand. The calculator below does both.
Prepared by Prospyr · Reviewed October 3, 2026 · Free, no sign-up, runs in your browser
Inventory turnover (all lines)
4.85×in 365 days
Days on hand
75.2 days
Turns per year
4.85×
| Line | Turnover | Days on hand |
|---|---|---|
| Neurotoxin | 10× | 36.5 |
| Dermal filler | 3.21× | 113.6 |
| Retail skincare | 2.73× | 133.8 |
A math aid. Value inventory at cost, not retail price, and use the same basis for COGS and inventory.
Inventory turnover ratio formula and days inventory outstanding
- Average inventory = (beginning inventory + ending inventory) ÷ 2
- Inventory turnover ratio = COGS ÷ average inventory
- Days inventory outstanding (days on hand) = average inventory ÷ COGS × days in period
- Annualized turnover = period turnover × 365 ÷ days in period
Corporate Finance Institute gives the same turnover formula and notes a 73-day inventory period equals 5 turns a year. Count only items you hold for sale or use on patients, and value them at what you paid.
Worked example: neurotoxin, filler and skincare
| Line | COGS (year) | Inventory start / end | Average | Turnover | Days on hand |
|---|---|---|---|---|---|
| Neurotoxin | $180,000 | $20,000 / $16,000 | $18,000 | 10.0× | 36.5 |
| Dermal filler | $90,000 | $30,000 / $26,000 | $28,000 | 3.2× | 113.6 |
| Retail skincare | $60,000 | $20,000 / $24,000 | $22,000 | 2.7× | 133.8 |
| All lines | $330,000 | $70,000 / $66,000 | $68,000 | 4.9× | 75.2 |
The combined 4.9 turns hides the spread: toxin turns about every 5 weeks and skincare about every 4.5 months. These are sample numbers for the arithmetic, not benchmarks. If a line turns slowly, the question to ask is whether you are buying more than you use, and the reorder point calculator turns that question into an order quantity.
Reading turnover for injectables and retail
High turnover means less cash on the shelf and less product to expire. Very high turnover can also mean you run out. Low turnover means cash sits in inventory and may age out before use. Compare a line with its own history first, then with the other lines.
Accurate inputs come from counting. Prospyr's inventory management tracks injectables down to the unit, tied to the appointments where they were used, which gives you the ending inventory and COGS numbers without a spreadsheet. For the cash side, see the cash flow calculator.
Frequently asked questions
What is the inventory turnover formula?
Inventory turnover = cost of goods sold ÷ average inventory, where average inventory is beginning inventory plus ending inventory, divided by 2. Use cost, not retail price, for both numbers. The result is the number of times you sold and replaced your stock in the period.
How do I calculate days inventory outstanding or days on hand?
Divide average inventory by COGS and multiply by the days in the period, which is 365 for a year. Equivalently, divide 365 by the annual turnover ratio. A turnover of 5 gives 73 days on hand, which matches the example in Corporate Finance Institute's guide.
What is a good inventory turnover for a med spa?
There is no single published benchmark for aesthetic practices, so this tool does not invent one. Compare your own lines over time and against each other. Neurotoxin and filler have expiry dates and high unit costs, so slow turns tie up cash and risk write-offs.
Should I use sales or COGS in the formula?
Use COGS, the cost of the product you sold, because inventory is valued at cost. Using sales makes the ratio look higher than it is, and it will not match the days-on-hand figure. If you only know your retail sales, multiply by your product cost percentage to estimate COGS.
Why measure each product line separately?
A single blended number hides which line is slow. Neurotoxin might turn every month while a skincare brand sits on the shelf for a year. The calculator shows each line next to the combined result so you can see where the cash is tied up.
Can I calculate turnover for a month or a quarter?
Yes. Pick the period, enter COGS and inventory for that period, and the tool gives turnover for those days and an annualized figure. A quarter with $30,000 of COGS and $10,000 average inventory gives 3 turns in the quarter, or about 12.2 turns per year.
Sources and scope
- Inventory turnover ratio: formula and days inventory. Corporate Finance Institute
Gives turnover = COGS ÷ average inventory, average inventory as the mean of beginning and ending balances, and days = inventory ÷ COGS × 365 (73 days equals 5 turns).
A math aid, not accounting advice. Use the same inventory valuation basis (cost) for COGS and inventory, and follow product storage and expiry rules.