How to Calculate Days Inventory Outstanding
What is Days Inventory Outstanding?
Days Inventory Outstanding Calculator helps logistics and supply chain professionals optimize operations and reduce costs.
Formula
DIO = (Average Inventory / COGS) × 365
Step-by-Step Guide
- 1Divide average inventory by daily COGS
- 2Apply the formula with your specific values
- 3Use the result to optimize operations or costs
Worked Examples
Input
$100,000 avg inventory, $500,000 COGS
Result
DIO = (100000/500000) × 365 = 73 days
Common Mistakes to Avoid
- ✕Using incorrect units or dimensions in the calculation
- ✕Ignoring surcharges and accessorial fees
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