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

Sales Velocity

Sales velocity measures the rate at which a SKU sells over time, typically expressed as units sold per day or per week. Formula: Sales Velocity = Units Sold ÷ Time Period

Why It Matters

  • •A key input for replenishment and demand planning.
  • •Faster velocity increases turnover and improves capital efficiency.
  • •Helps detect early signs of demand shifts.
  • •Affects how much inventory should be held and how frequently it should be replenished.

Connection to Capital

Higher velocity speeds up capital cycles, increasing the number of opportunities to earn returns within a year.

Related Terms

Revenue Inventory Turnover Stockouts

Related Articles

Making Better Restocking Decisions When Capital Is Limited
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.