Definition of Inventory days:
The average number of days goods remain in inventory before being sold. As a measure of short-term sales potential, a number above the industry norm indicates problems with sales forecasts. And a number below the norm indicates loss of sales due to the companys inability to fulfill demand. Also called days cover, stock cover, days of inventory, or days sales to inventory. Formula: Average inventory x 365 ÷ sales revenue.
Meaning of Inventory days & Inventory days Definition