function calculateSellThrough() {
// Get input values
var sold = document.getElementById('str-units-sold').value;
var start = document.getElementById('str-start-inventory').value;
var received = document.getElementById('str-received-inventory').value;
var resultDiv = document.getElementById('str-result');
var percentDiv = document.getElementById('str-percentage');
var textDiv = document.getElementById('str-text');
// Parse values to float, defaulting to 0 if empty
var soldNum = parseFloat(sold);
var startNum = parseFloat(start);
var receivedNum = parseFloat(received);
// Validate inputs
if (isNaN(soldNum) || isNaN(startNum) || soldNum < 0 || startNum 100) {
// While technically impossible in physical retail without backorders, we display the raw number but add a warning.
textDiv.innerHTML = "Warning: Units sold exceed total inventory. Check your data inputs.";
} else {
// Determine health status
var healthStatus = "";
var color = "";
if (rate >= 80) {
healthStatus = "Excellent. High demand, but watch for stockouts.";
color = "#28a745"; // Green
} else if (rate >= 40) {
healthStatus = "Healthy. Good balance of sales and stock.";
color = "#17a2b8"; // Teal
} else {
healthStatus = "Slow Moving. Consider markdowns or promotion.";
color = "#dc3545"; // Red
}
textDiv.innerHTML = "Inventory Health: " + healthStatus + "";
percentDiv.style.color = color;
}
// Display Result rounded to 2 decimal places
percentDiv.innerHTML = rate.toFixed(2) + "%";
resultDiv.style.display = 'block';
}
What is Sell-Through Rate?
Sell-Through Rate (STR) is one of the most critical Key Performance Indicators (KPIs) in retail management, e-commerce, and inventory planning. It measures the percentage of your inventory that is sold within a specific time period relative to the total stock available.
Unlike simple sales volume, the sell-through rate tells you how efficiently you are moving product. A high sales number might look good, but if you bought ten times that amount in stock, your efficiency is low, and your capital is tied up in warehousing.
How to Calculate Sell-Through Rate
The formula for calculating sell-through rate is straightforward. It compares the number of units sold against the total inventory available (Beginning Inventory + Any New Shipments) during that period.
Sell-Through Rate Formula:
(Units Sold ÷ Total Inventory Available) × 100
Example Scenario:
Imagine you run a boutique sneaker shop.
You start the month with 500 pairs of sneakers (Beginning Inventory).
Mid-month, you receive a shipment of 100 pairs (Units Received).
By the end of the month, you have sold 300 pairs.
Your total available inventory was 600 pairs (500 + 100).
Calculation: (300 ÷ 600) × 100 = 50% Sell-Through Rate.
Why is Sell-Through Rate Important?
Monitoring this metric helps retailers make data-driven decisions regarding pricing, purchasing, and marketing:
Cash Flow Management: High STR means you are converting inventory to cash quickly.
Storage Costs: Low STR indicates "dead stock" that incurs storage fees without generating revenue.
Merchandising: Helps identify which products are winners (fast movers) and which are losers (slow movers).
What is a "Good" Sell-Through Rate?
Benchmarks vary significantly by industry (e.g., fast fashion vs. luxury furniture), but general guidelines include:
High (> 80%): Excellent demand. However, if the rate is consistently near 100%, you may be under-buying and losing potential sales due to stockouts.
Average (40% – 80%): A healthy zone. You have enough stock to meet demand without carrying excessive overhead.
Low (< 40%): Indicates overstocking or low demand. You may need to run promotions, offer discounts, or bundle items to clear this inventory.
Strategies to Improve Your Sell-Through Rate
If your calculator results show a low percentage, consider these tactics:
Markdowns and Promotions: Lower the price to increase sales velocity.
Better Visual Merchandising: Move the product to a high-traffic area on your website or store floor.
Bundle Products: Pair slow-moving items with best-sellers.
Adjust Procurement: Reduce order quantities for future shipments of similar items.