Free Inventory Health Check

Is Your Inventory Helping or Hurting Your Profitability?

Take this 10-minute assessment and get instant clarity on your inventory performance.

Part 1: Score your company on a scale of 1-5 on each of the following.

  1. We have good visibility into which products are profitable vs. unprofitable

  2. Our inventory turnover feels healthy for our industry

  3. We rarely have stockouts on top-selling items

  4. We rarely have large amounts of slow-moving or obsolete stock

  5. Our cash is not overly tied up in inventory

  6. We have a clear, data-driven process for setting reorder points

  7. We regularly review product profitability by SKU, channel, and customer

  8. Our team trusts the inventory data in our system

  9. We know our true carrying costs of inventory

  10. We have a plan to reduce excess inventory without hurting service levels

Add up your scores and use the following ranges to see how you did.

Scoring Guide:

  • 45–50: Excellent – Inventory is a strategic asset

  • 35–44: Good – Minor improvements available

  • 25–34: Average – Profit leaks likely exist

  • 15–24: Concerning – Significant cash tied up

  • Below 15: Critical – Major risk to profitability

Part 2: Key Inventory Health Metrics

Calculate these using your most recent 12-month data:

  1. Inventory Turnover = COGS ÷ Average Inventory Value
    Target: 4–8x (higher is better)

  2. Days Inventory Outstanding (DIO) = (Average Inventory ÷ COGS) × 365
    Target: 45–90 days

  3. Stockout Rate (%) = (Stockout occurrences ÷ Total order lines) × 100
    Target: < 5%

  4. Excess & Obsolete % = (Slow-moving + Obsolete value ÷ Total Inventory) × 100
    Target: < 10–15%

  5. GMROI = Gross Margin Dollars ÷ Average Inventory Value
    Target: > 2.0

  6. Inventory Accuracy (%) = (Correct counts ÷ Total items counted) × 100
    Target: > 98%

Part 3: What Your Results Mean + Recommended Actions

Common Red Flags

  • Turnover below 4×

  • DIO above 120 days

  • Excess inventory > 20%

  • Frequent stockouts on fast-moving items

Next Steps Based on Your Score

  • Excellent/Good: Advanced forecasting and ABC/XYZ segmentation

  • Average/Concerning: Full profitability analysis + inventory optimization project

  • Critical: Urgent cash recovery diagnostic

Claim Your Next Step

Use the form below to send your numbers to Tracey Smith and she will send you a personalized report. Your numbers will remain confidential. If you prefer, you can also contact Tracey to Book a free 30-minute Inventory Review Call with Tracey Smith to discuss your results.