Zansa › Answers › Retail and e-commerce
What is stock cover and how do I calculate it for my shop?
Stock cover is how long current stock will last at the current rate of sales. Divide units on hand by average units sold per day, week or month. If you hold 600 units and sell 100 a week, stock cover is six weeks.
Formula in words: stock on hand divided by average sales rate over a chosen period.
It matters because it shows both overstock, which ties up cash, and understock, which causes lost sales. Compare it to supplier lead time: if cover is shorter than the time a reorder takes to arrive, you will run out.
Commonly misread:
- Using a sales average that includes a one-off promotion or a stock-out period.
- Calculating it only at total level, which hides products with ten weeks of cover next to products with none.
- Ignoring stock already on order.
Calculate it per product or category, using a recent, representative sales rate.
Want this applied to your business? Zansa builds dashboards and forecasts for small and mid-sized companies worldwide. Start with a free intro call.
Book a call