Inventory to sales ratio.

Worked example

Month-end inventory of $180,000 and monthly sales of $120,000 give a ratio of $180,000 / $120,000 = 1.50. Read it as roughly 1.5 months of sales sitting in stock at the current sales pace. The inverse, sales to inventory, is 0.67.

How it works

The ratio is inventory divided by sales. The U.S. Census Bureau publishes the monthly "Total Business: Inventories to Sales Ratio" series (shown on FRED as ISRATIO), built from retail, wholesale and manufacturing surveys. This page verified that series exists and its title; the calculation here is plain division of the two figures you enter.

Use matching bases: inventory at the end of the period and sales for that period (one month with month-end inventory gives a result in months of sales). Mixing inventory at cost with sales at retail price overstates sales and understates the ratio, so keep both at cost or both at retail.

A high ratio can mean overstocking or slow sales, and a low one can mean lean operations or stockouts. This page does not publish industry benchmarks; compare with your own history.

Sources (opened 2026-10-18): Total Business: Inventories to Sales Ratio (ISRATIO) - FRED, U.S. Census Bureau data. The formula wording above follows these pages; the example figures and all arithmetic are ours.

Inputs are user-entered figures. Results are planning estimates, not financial advice or a forecast. Everything runs in your browser. Nothing you type is sent or stored.

FAQ

How do you calculate the inventory to sales ratio?

Divide inventory by sales for the same period. $180,000 of inventory against $120,000 of monthly sales is 1.5.

What does an inventory to sales ratio of 1.5 mean?

With monthly sales, the stock on hand equals about 1.5 months of sales at the current pace.

How is it different from inventory turnover?

Turnover is cost of goods sold divided by average inventory, usually per year. The inventory-to-sales ratio is a stock-over-flow snapshot, often using sales rather than cost.

Should inventory be at cost or retail?

Either, but use the same basis for sales. Mixing them distorts the ratio.