Inventory how-to

How to calculate sell through rate

Sell through rate is the percentage of stock you received that you actually sold in a given period.

Short answer: Sell through rate is the percentage of stock you received that you actually sold in a given period. Divide units sold by units available to sell, then multiply by 100. It tells you how fast a product is moving relative to how much of it you had.

The formula

Sell through rate = (units sold in period / units available at start of period) x 100.

Units available means what you had on hand at the start, not what you have now. If you received more stock mid period, decide upfront whether you want to include those units or measure a cleaner before-and-after window.

Choosing a period

Weekly or monthly periods work for most small stores. Weekly is better for fast sellers or short promotions. Monthly smooths out noise for slower variants and is easier to compare month to month.

Be consistent. If you compare sell through rates across SKUs, use the same period length and the same definition of "available" for all of them, otherwise the numbers are not comparable.

What the number tells you

A high sell through rate means the product is moving fast relative to stock on hand. That can be good news, or it can be a warning that you are close to running out. A low sell through rate means stock is sitting. That can point to overbuying, weak demand, poor placement, or pricing issues.

Sell through rate alone does not tell you whether to reorder. A product can have a high sell through rate and still not need reordering if you only had 5 units to begin with. Pair it with actual daily sales and lead time to decide on quantities.

Step by step

  1. Pick a period: weekly for fast movers, monthly for slower ones.
  2. Record units on hand at the start of the period for each SKU or variant.
  3. Record units sold during that same period from your sales data.
  4. Divide units sold by units on hand at the start, then multiply by 100.
  5. Repeat for each SKU using the same period length so results are comparable.
  6. Flag SKUs with very high sell through rates for reorder review, and very low ones for markdown or promotion review.

Worked example

A store starts the month with 200 units of a candle variant on hand. Over the month they sell 60 units. Sell through rate = (60 / 200) x 100 = 30%. A second variant starts the month with 40 units and sells 32 of them, giving (32 / 40) x 100 = 80%. The second variant is moving much faster relative to its stock, even though it sold fewer total units, so it is the one more likely to need a reorder soon.

How SteadyShelf helps

SteadyShelf does not calculate or display sell through rate directly, since it focuses on daily sales velocity and order-by dates rather than this metric. You can still get the inputs easily: your store admin reports give units sold and starting stock per variant, and you can run the simple formula above in a spreadsheet alongside SteadyShelf's reorder suggestions.

$29/month flat, unlimited products and suppliers, 30-day free trial. Run the numbers now with the free reorder point calculator.

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

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FAQ

Should I use units or revenue for sell through rate?

Use units. Sell through rate measures inventory movement, not money. If you want a revenue version, calculate it separately and label it clearly so you do not mix the two.

What counts as a good sell through rate?

There is no universal target, it depends on your product type, order cycle, and how much safety stock you carry. Instead of chasing a fixed number, track each SKU's rate over time and watch for sudden increases or drops.

Let SteadyShelf do this math for every SKU

Order-by dates per supplier, seasonal forecasts and draft POs for your Shopify store. $29/month after a 30-day free trial.

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