Quick Answer: Two divisions show your stock risk. Sales velocity is units sold divided by days, so 84 units over 28 days is 3 a day. Days of inventory is units on hand divided by velocity, so 60 units at 3 a day is 20 days (Practical Ecommerce, 2026). Compare 7, 28 and 90-day windows, and judge the result against your reorder lead time.
You don’t need forecasting software to know which products are about to run out. You need two divisions and a few weeks of sales. This guide follows a September 2026 Practical Ecommerce piece on sales velocity, adds a US stock-to-sales ratio from the same article, and shows how a small shop can use them. Most of the numbers are the author’s worked examples, and we label them that way.
In this article
- What is sales velocity?
- How do I work out days of inventory?
- Is 20 days of stock enough?
- How much stock does the average US retailer hold?
- What would that ratio mean for my shop?
- Why does a cheap item move faster than an expensive one?
- Which time windows should I compare?
- How do I read the trend?
- How do small retailers usually find out an item is gone?
- How much cash is tied up in stock?
What is sales velocity?
Sales velocity is units sold divided by the number of days. 84 units over 28 days is 3 units a day, according to Practical Ecommerce (2026). It’s a plain speed measure for one product.
Use the same window for every product so the numbers compare fairly. A seasonal item will look very different over a week than over a quarter.
How do I work out days of inventory?
Divide the units on hand by your sales velocity. 60 units at 3 a day gives 20 days of stock, in the article’s example. That tells you how long the shelf lasts if sales stay the same.
In plain terms, days of inventory is a countdown. Check it weekly for your top sellers, and you’ll see problems before a customer does.
Sales velocity is units sold divided by days, and days of inventory is units on hand divided by velocity: 60 units at 3 a day is 20 days of stock (Practical Ecommerce, 2026).
Is 20 days of stock enough?
It depends on your lead time. The article presents 20 days only as an example, not as a standard. If a reorder takes 30 days to arrive, 20 days of stock means a gap.
Compare days of inventory with how long it takes to get more. If stock lasts shorter than the lead time, order now.
Related: WooCommerce stock settings explained: low stock alerts, hold stock and backorders
How much stock does the average US retailer hold?
In June 2026, US retailers held merchandise equal to about 1.23 months of sales, according to the Federal Reserve Bank of St. Louis series cited by Practical Ecommerce. That’s a US average across all retailers, not a target for your shop.
It gives you a rough yardstick. If you hold much more than that for most products, your cash is probably sitting on the shelf.
What would that ratio mean for my shop?
By the article’s own arithmetic, a shop averaging $50,000 in monthly sales would hold about $61,500 of inventory at cost at that ratio. That’s 50,000 multiplied by 1.23. It’s an illustration, not a benchmark.
Do the same sum with your own figures. Use your monthly sales at cost and compare the answer with what’s actually on your shelves.
| Trend | What it suggests |
|---|---|
| Rising sales, low stock | You may run out soon |
| Rising sales, enough stock | A sales opportunity |
| Steady sales, enough stock | Healthy inventory |
| Falling sales, high stock | Excess inventory |
| Dead sales, high stock | Markdown or phase-out candidate |
Why does a cheap item move faster than an expensive one?
In the article’s hypothetical, two products each make $10,000 a month: a $500 item selling 20 units and a $25 item selling 400. The cheaper item moves 20 times faster, even though both earn the same.
So don’t judge stock by sales value alone. A cheap, fast item can run out far sooner than an expensive one with the same revenue.
In June 2026 US retailers held merchandise equal to about 1.23 months of sales (Federal Reserve Bank of St. Louis, via Practical Ecommerce, 2026).
Which time windows should I compare?
The article recommends comparing 7-day, 28-day and 90-day windows to smooth noise and reveal trends. A hypothetical product selling 5 a day over the past week, 3 a day over 28 days and 2 a day over 90 shows accelerating demand.
The short window warns you; the long window keeps you calm. If all three point the same way, act.
Comparing 7-day, 28-day and 90-day sales windows smooths noise and reveals trends in demand (Practical Ecommerce, 2026).
How do I read the trend?
Match sales and stock to 5 situations: rising sales with low stock means you may run out soon, rising sales with enough stock is an opportunity, steady sales with enough stock is healthy, falling sales with high stock is excess, and dead sales with high stock is a markdown candidate. The table above sets them out.
These pairings are the author’s interpretation, not sourced research. They’re useful as a checklist, so treat them that way.
How do small retailers usually find out an item is gone?
Nearly one in four small retailers only learn an item is out of stock when a customer tries to buy it, according to the Global Payments 2025 Retail Inventory Report of 200 small retailers. The report is small, so treat it as a pointer.
Days of inventory is how you change that. Set a low stock alert too: at variation level, WooCommerce sends a notification email when stock reaches the threshold, according to its documentation (2026).
Related: How to stop overselling across your website, Shopee and Lazada
How much cash is tied up in stock?
Inventory ties up 20% to 60% of business capital for most small retailers, according to Global Payments (2025). Every extra week of stock on a slow item is cash you can’t spend elsewhere.
Velocity is far easier to follow when the system updates stock with every sale. Asalta Inventory keeps one live count across stores, websites and marketplaces, and it’s one option to compare. A spreadsheet and a weekly check work too. You can read more on the Asalta Inventory page.
Key Takeaways
- Divide twice: velocity is units over days, and days of inventory is stock over velocity.
- Check the lead time: 20 days of stock is only enough if a reorder arrives sooner.
- Compare three windows: 7, 28 and 90 days show the trend.
- Remember cheap items: a $25 item can sell 400 units while a $500 item sells 20.
- Mind the cash: inventory ties up 20% to 60% of capital.
Sales velocity is units sold divided by the number of days, so 84 units over 28 days is 3 units a day.
Divide the units on hand by your sales velocity; 60 units at 3 a day gives 20 days of stock.
It depends on your lead time. The article presents 20 days only as an example, not a standard.
In June 2026 US retailers held merchandise equal to about 1.23 months of sales, according to the Federal Reserve Bank of St. Louis series cited by Practical Ecommerce.
By the article’s own arithmetic, a shop averaging $50,000 in monthly sales would hold about $61,500 of inventory at cost at that ratio.
In the article’s hypothetical, two products each make $10,000 a month: a $500 item selling 20 units and a $25 item selling 400, so the cheaper one moves 20 times faster.
The article recommends comparing 7-day, 28-day and 90-day windows to smooth noise and reveal trends.
Rising sales with low stock means you may run out soon, rising sales with enough stock is an opportunity, steady sales with enough stock is healthy, falling sales with high stock is excess, and dead sales with high stock is a markdown candidate.
Nearly one in four only learn an item is out of stock when a customer tries to buy it.
Inventory ties up 20% to 60% of business capital for most small retailers.