How It Works Approach Features Who It's For Knowledge Hub Glossary FAQ Contact Us
Back to Glossary

Days of Supply (DOS)

Days of Supply (DOS) indicates how many days existing inventory will last at the current or forecasted sales rate. Formula (units): DOS = Inventory Units ÷ Average Daily Units Sold

Why It Matters

  • •A fundamental operational metric used in replenishment planning.
  • •Helps prevent stockouts and overstock by balancing supply and demand.
  • •More intuitive for many operators than turnover, since it is expressed in days.
  • •DOS errors lead directly to excess inventory or lost sales.

Connection to Capital

Higher DOS means more capital is tied in inventory. Lower DOS may reduce capital requirements but increases stockout risk. Optimising DOS directly affects capital efficiency.

Related Terms

Sales Velocity Lead Time Stockouts

Related Articles

Lead Time as a Financial Variable: Why Buying "Cheaper" Can Cost You More
Why Payment Terms Matter Much More Than They Seem

If a term is missing, you'd like it explained, or you have suggestions for improvement — we'd love to hear from you. Contact Us →

Join the Free Beta

Be among the first to experience cash flow optimization.