Days Inventory Outstanding (DIO) Calculator
Enter beginning inventory, ending inventory, COGS and the period length to find Days Inventory Outstanding — how long, on average, goods sit in stock before being sold — and the associated inventory turnover ratio.
days
Inventory basis
Average number of days inventory is held before being sold
- 1
Average inventory
(500,000 + 600,000) ÷ 2 = 550,000 - 2
DIO = (avg inventory ÷ COGS) × period
(550,000 ÷ 2,000,000) × 365 = 100.4
How does this calculator work?
DIO = (Average Inventory ÷ COGS) × Period Days, where Average Inventory = (Beginning + Ending) ÷ 2. Inventory Turnover = COGS ÷ Average Inventory = Period ÷ DIO. All three inputs must cover the same period (e.g. all annual or all quarterly). Lower DIO signals faster inventory movement and better working-capital efficiency; optimal values vary widely by industry.
Formula
How this is calculated
Days Inventory Outstanding (DIO) — also called Days Sales of Inventory (DSI) or inventory days — measures how many days worth of cost of goods sold is tied up in inventory at any point in time. A lower DIO means inventory moves quickly; a higher DIO means goods sit on shelves longer, tying up working capital and increasing storage costs.
The formula uses average inventory (beginning + ending ÷ 2) rather than a single snapshot to smooth out seasonal variation or deliberate stock build-ups at period boundaries. When only one balance sheet snapshot is available, the ending inventory alone may be used — the option is provided in the calculator. COGS and the inventory figures must cover the same period (for annual DIO, use annual COGS and year-start/year-end inventory).
DIO is the inventory component of the Cash Conversion Cycle (CCC): CCC = DIO + Days Sales Outstanding (DSO) − Days Payable Outstanding (DPO). A shorter CCC means the company converts inventory to cash faster. Acceptable DIO varies widely by industry: grocery retailers may target 5–15 days, car dealers 30–60 days, and aircraft manufacturers several hundred days.
Frequently asked questions
It depends entirely on the industry. Fast-moving consumer goods (FMCG) and grocery typically target 5–30 days; electronics and apparel 30–90 days; heavy machinery and aerospace 100–300+ days. Compare DIO to your industry peers and to your own historical trend rather than using an absolute benchmark.
Average inventory (beginning + ending ÷ 2) is the standard approach and smooths out intentional build-ups or draw-downs at period boundaries. Use ending inventory only if you have a single balance sheet date and no beginning balance, or if your inventory is highly stable throughout the year.
Inventory turnover = COGS ÷ Average Inventory, and DIO = Period Days ÷ Inventory Turnover. They are reciprocals of each other when measured over the same period: a turnover of 6× per year is DIO = 365/6 ≈ 61 days. Higher turnover means lower DIO and vice versa.
Also known as
TG we-Calculate Editorial Team. (2026). Days Inventory Outstanding (DIO) Calculator [Online calculator]. TG we-Calculate. https://we-calculate.com/calculator/days-inventory-outstanding-calculator
TG we-Calculate Editorial Team. "Days Inventory Outstanding (DIO) Calculator." TG we-Calculate. 2026. https://we-calculate.com/calculator/days-inventory-outstanding-calculator.
TG we-Calculate Editorial Team, "Days Inventory Outstanding (DIO) Calculator," TG we-Calculate, 2026. [Online]. Available: https://we-calculate.com/calculator/days-inventory-outstanding-calculator
@misc{wecalculate_days_inventory_outstanding_calculator, title = {Days Inventory Outstanding (DIO) Calculator}, author = {{TG we-Calculate Editorial Team}}, howpublished = {\url{https://we-calculate.com/calculator/days-inventory-outstanding-calculator}}, year = {2026}, note = {TG we-Calculate} }
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