5 Inventory Metrics That Actually Matter

(And Why Your Ops Might Be Flying Blind Without Them)

Inventory isn’t just a pile of boxes in a warehouse. It’s cash flow, growth rate, margins, customer trust, and peace of mind all rolled into one.
But let’s be real: most brands aren’t tracking the stuff that actually moves the needle.

So, here’s your cheat sheet: five inventory metrics that separate the “meh” ops from the dialed-in, margin-happy, growth-ready ones:

1. Sales Forecast Accuracy (%)

You can’t plan what you can’t predict.

This one’s the heartbeat of inventory. It tells you how close your sales forecast was to reality. If you’re way off, you’re either stocking out (and missing revenue) or over-ordering (and jamming your cash flow).

• Shoot for 65–80% accuracy
• Track it monthly
• How to measure? Simple:
   1 – (Absolute(Forecasted Qty – Actual Qty Sold) ÷ Actual Qty Sold)

If your accuracy is below 60%, you’re probably firefighting more than forecasting.

2. Stockout Rate (%)

Every stockout is a missed sale and a hit to customer trust.

If your Stockout Rate is over 3%, you’re basically waving customers over to your competitors, with a smile. Translation? You’re bleeding revenue and driving up your CAC. That first purchase you paid so much to win? Gone.

• Fight to keep it under 3%
• Track it monthly
• How to measure? The simple way:
   Average daily demand × out-of-stock days × average sale price

If you’re consistently above 5%, you’re not just leaking revenue- you’re training your customers to buy somewhere else.

3. Excess Inventory (%)

Excess inventory is stock that you ordered more of than you need- often because of an optimistic sales forecast or a rushed reorder.

If it’s been sitting untouched for months, it’s not just tying up cash- it’s choking your margins. Excess inventory isn’t as dramatic as dead stock, but it’s still a silent killer. You’re buying too much, too early, and tying up capital you could be using to grow.

• Keep it under 10% of your total inventory
• Track it weekly
• How to measure it? Simple:
   Sum of inventory value that’s +6 months old ÷ Total inventory value

If you’re not tracking this, don’t be surprised when your warehouse feels full but your bank account doesn’t.

4. Airfreight %

Airfreight is like hot sauce-powerful, but don’t overdo it! When you need speed, it delivers, but if it’s too much, it’ll burn through your margins with panic premiums.

• Goal: Less than 10%
• Track it monthly
• How to measure:
   (Quantity shipped by air ÷ Total quantity shipped) × 100

Over 10%? You’re killing your margins with those expensive “air premiums.”

5. Average Delivery Zone

This one’s sneaky powerful.

It tells you how far your product travels to get to your customers. The further the average distance, the more you’re paying in shipping, and the longer it takes to deliver. High zones = inefficiency hiding in plain sight.

• Sweetspot = Zone 4.5 – 5 if you’re shipping from a single location, Zone 4 – 4.5 from 2 locations
• Track it weekly
• How to measure:
  Weighted average across zones, based on the number of orders shipped to each zone

Lower zones = faster shipping, happier customers, and healthier margins. Use this metric to decide where to hold inventory, not just how much.

Wrap-Up: Metrics That Move the Needle

These five metrics aren’t just numbers – they help you restock with confidence, and pull the right levers to:

• Unlock more revenue by avoiding stockouts

• Free up cash flow by cutting excess inventory

• Protect your margins by reducing expensive shipments and storage costs

And if keeping tabs on all this sounds like a full-time job? That’s what our AI agent is for.

Our AI agent tracks these metrics (and more) 24/7. It flags issues before they become problems.

It adjusts planning when trends shift.

It’s the always-on sidekick you need to stay on top of your inventory, without the stress.