Apparel Inventory Terms, Explained

Sell-through compares units sold with units received. If you received 200 units of a hoodie and sold 150 in the first month, you sold three quarters of what came in. A high number early means you may sell out. A low number means the style is slow.

Look at sell-through by size and color, not just by style. A style can look healthy overall while one size sells out and another sits.

Worked example

Divide units on hand by units sold per week. If you have 120 units and sell 30 a week, you have four weeks of supply. Compare that with how long a reorder takes to arrive. If supply runs out before the reorder lands, you will stock out.

For apparel, check weeks of supply by size. The medium may have two weeks left while the XXL has twenty.

Size curve

The proportion of each size you order. If mediums and larges make up most of your sales, they should make up most of your buy. Base it on your own sales, by style type. See size curve planning.

Reorder point

The stock level that triggers a new production or purchase order. It equals what you expect to sell during the reorder lead time, plus a safety buffer. See reorder points for core styles.

Open-to-buy

The budget left to spend on new inventory for a period, after counting what is already on hand and on order. It stops a brand from buying more than it can sell or afford.

Dead stock is inventory that has stopped selling and is unlikely to sell at full price. In apparel it is often last season’s colors and the sizes you over-bought. It costs storage every day it sits.

• Review inventory age monthly. Flag anything that has not sold in a set number of weeks.
• Move it through bundles, gifts with purchase, outlet sales or wholesale.
• Feed the lesson back into the next size curve.

More in dead stock in apparel. Storage at OC3PL is based on the space your inventory actually uses and is pro-rated daily, so clearing slow stock lowers the bill quickly.

Inventory turn

Inventory turn measures how often you sell through your average inventory in a year. A higher turn means stock moves quickly and less cash sits on shelves. A low turn means you are paying to store product that is not moving. For apparel, look at it by style, because core basics and seasonal pieces behave differently.

Stock-to-sales

Stock-to-sales compares inventory at the start of a period with sales during it. It helps you check whether you are carrying too much or too little for the season you are in.

A monthly inventory review

1. Pull inventory on hand by SKU from your warehouse portal.
2. Pull units sold by SKU for the last four weeks.
3. Calculate weeks of supply by size, and flag anything under your reorder lead time.
4. Flag anything with very high weeks of supply as a markdown or bundle candidate.
5. Check sell-through on the newest styles and adjust the next buy.

It takes an hour a month once the data is clean, and it prevents the two expensive mistakes: selling out of your best size, and paying to store sizes nobody buys.

All of these measures depend on accurate counts by SKU. If the warehouse count is wrong, the math is wrong. OC3PL’s client portal shows inventory counts at the SKU level, and alerts can be set for low stock. Every style is slotted by size and color, so a picker reaching for a medium in black is not digging through a bin of mixed sizes. A new collection is slotted and ready to ship within one business day of receipt.

See apparel inventory accuracy and real-time SKU reporting.