Inventory glossary

What is Sell-through rate?

Sell-through rate is the percentage of stock you sold over a period compared to the stock you had available to sell.

Sell-through rate tells you if a product is moving or sitting on the shelf. A low rate on a variant means you bought too much or demand dropped, and you should slow down or stop reordering it. A high rate means you are close to selling out and need to reorder soon.

Use it variant by variant, not just at the product level. Two sizes of the same shirt can have very different sell-through rates, and averaging them hides the slow one until it turns into dead stock.

Formula

Sell-through rate = (units sold / units available) x 100

Example

A candle shop starts the month with 200 units of a jar candle in stock and sells 60 of them that month. Sell-through rate = (60 / 200) x 100 = 30 percent. If a different scent only sells 10 out of 200, its 5 percent rate flags it as slow moving.

Common mistakes

Using total inventory instead of units available at the start of the period, which skews the rate if stock arrived mid-month.
Comparing sell-through rates across products with very different price points without context, since a high rate on a cheap item is not the same signal as on an expensive one.
Looking at sell-through only at the product level and missing that one variant is dead while another is stocking out.

Sell-through rate and SteadyShelf

SteadyShelf tracks per-variant sales so you can see which variants have a low sell-through rate and should not be included in the next order-by-date quantity suggestion.

Work it out for your own products with our free tool: Sell through rate calculator.

SteadyShelf is launching on the Shopify App Store. Join early access to get the install link first.

Full inventory glossary

FAQ

What counts as a good sell-through rate?

There is no universal good number. It depends on your product, category, and how often you reorder. Compare a variant's rate to your own other variants and its own past performance, not to an outside benchmark.

Does sell-through rate account for stockouts?

No. If a product was out of stock for part of the period, the rate understates real demand, because you could not sell units you did not have. Check stockout days alongside sell-through rate before deciding a product is slow moving.

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