Days of supply

Days of supply translates the current inventory quantity into a time horizon — how many days it would last at the recent or expected rate of usage before running out — which is often easier to act on than a raw unit count.

It's calculated as days of supply = inventory on hand / average daily usage. It's the inverse framing of inventory turnover, which expresses the same underlying efficiency as a ratio over a full period rather than as a running number of days remaining.

Planners compare days of supply against lead time to judge whether a reorder is needed before stock runs out, and against safety stock targets to spot risk early. Because it depends on "average daily usage," the figure is sensitive to which time window and demand forecasting method is used to compute that average — a recent spike or lull can distort it. It's most useful as a rolling, frequently recalculated number rather than a one-time snapshot.