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Practitioner · Course 1: Retail Maths · Lesson 2 of 5

Calculating sell-through and stock cover from real sales

Level: FoundationTime: 45 minutesOrder used: A (the T-shirt, Northline Apparel export order, resold wholesale to Fairway Stores)Tool: Retail maths reference workbook
For a merchandiser at a factory, a buyer, or a retail planner who needs to read sell-through rate and stock cover from real sales and use them to judge whether a reorder is coming. Lesson T20-C01-L01 is useful but not required. Figures are teaching examples in US dollars.
FactoryDelta Garments
Export orderOrder A, 15,000 T-shirts, FOB USD 3.20
Retail buyerFairway Stores, buys wholesale at USD 8.00
Shop priceUSD 19.90, Fairway Stores' own shop price
Season checkpointWeek 8: 11,000 of 15,000 pieces sold, illustrative figures
What this lesson measuresWhether Order A's remaining stock signals a reorder to Delta Garments
02Opening

This page explains how to calculate sell-through rate and stock cover from real sales, and how a factory reads the same two numbers to judge whether a reorder is coming

This page is for a merchandiser at a factory, a buyer, or a retail planner who needs to turn a retailer's raw weekly sales into two numbers that say how a style is actually moving. This lesson mainly teaches the information flow: it shows how sales data collected at the shop travels back up the chain to the factory, and how the factory reads it without ever seeing the shop floor itself.

Fairway Stores sells Order A in its own shops, and Delta Garments, the factory that made it, never sees a single shop directly. What Delta Garments can see is the sell-through rate and stock cover that Northline Apparel passes back down the chain from Fairway Stores' own sales data. Mona, the merchandiser at Delta Garments, uses exactly these two numbers to judge whether Fairway Stores is likely to place a reorder, well before any reorder purchase order actually arrives.

03Before you start

What you need, and what this lesson does not cover

You need: no previous lesson, though lesson T20-C01-L01 introduces sell-through rate and stock cover briefly and is a useful start. Order A's own fixed order quantity of 15,000 pieces is enough to begin.

By the end of this lesson you can:

  • calculate sell-through rate from pieces sold and total order quantity at any point in a season;
  • calculate a weekly sales rate from pieces sold and weeks elapsed, then use it to calculate stock cover;
  • read sell-through rate and stock cover together to judge whether a style is trading ahead of, on, or behind its own plan;
  • explain why a factory watches a retailer's sell-through rate even though the factory never sees the shop floor;
  • avoid mistaking a rising sell-through rate alone for proof that a reorder is guaranteed.

Not covered here: margin, markup and average selling price worked together (lesson T20-C01-L03), like-for-like growth between two seasons (lesson T20-C01-L04), and assembling every calculation into one reference sheet (lesson T20-C01-L05).

04Key terms

Words you will meet in this lesson

TermMeaning
Sell-through rateThe share of stock actually sold within a planned period, used to judge whether a forecast was right.
Stock coverThe number of weeks a brand's current stock is expected to last before it runs out, given its normal sales rate.
Weekly sales rateThe average number of pieces of a style sold in one week, found by dividing total pieces sold by the number of weeks elapsed.
ReorderA repeat purchase order placed against a style the retailer has already sold before, based on its own forecast rather than a new buyer commitment.
CheckpointA specific moment in an order's life where its progress is checked against the plan.
05Teaching
The rule

Sell-through rate looks backward at what has already sold, and stock cover looks forward at how long the rest will last

Sell-through rate divides pieces already sold by the total order quantity, describing what has happened so far. Stock cover divides remaining stock by the recent weekly sales rate, describing what is likely to happen next if nothing changes. The two numbers are calculated from the same underlying sales data but answer different questions, and a factory watching from outside the shop needs both, because a high sell-through rate late in a season and a high sell-through rate early in a season imply very different things about whether more stock will be needed.

Sell-through rate on Order A at week eight: 11,000 / 15,000 = 73.3%
What you meet in real life

The same two numbers change meaning depending on when in the season they are read, and on which side of the chain is reading them

What can differThe shapes you will meetWhy it matters
An export order read from the factory side, well before any reorder is confirmedDelta Garments never sees Fairway Stores' shop floor, but Mona receives Order A's own sell-through rate and stock cover from Northline Apparel each week and uses them to judge reorder likelihood early.A factory that waits for a confirmed reorder purchase order before planning capacity may lose the chance to fit a reorder into its own production schedule in time.
A domestic order read directly by the buyer, with no factory watching from outsideA local brand such as Cedar & Co. tracks its own sell-through rate and stock cover directly, since it buys from Delta Garments on open account with no separate wholesale step passing the data along.Fewer companies in the chain means fewer hand-offs of the same sales data, but the sell-through rate and stock cover calculations themselves stay identical.
A high sell-through rate read early in a seasonIf Order A reached 73.3% sell-through by week eight of a twenty-week planned season, most of the stock is already gone with most of the selling weeks still ahead.A high sell-through rate this early usually signals under-stock, not success alone, and a reorder is likely if remaining lead time allows one to arrive before the season ends.
The same high sell-through rate read late in a seasonIf Order A reached 73.3% sell-through in the final week of a planned season, the remaining 26.7% is exactly the leftover stock a season is expected to end with.The same percentage read at a different point in the season calls for a completely different response, from reorder to simple clearance.
The case we follow

Mona at Delta Garments reviews Order A's own week-eight checkpoint before any reorder purchase order has arrived

By the end of week eight, Fairway Stores has sold 11,000 of the 15,000 pieces of Order A, leaving 4,000 pieces in stock, illustrative sales figures kept for teaching purposes only. Northline Apparel passes this checkpoint back to Delta Garments as part of its regular reporting, well ahead of any confirmed reorder. Mona checks whether the season's own remaining weeks and Delta Garments' own production lead time still allow a reorder to reach the shops in time, before recommending that Delta Garments reserve capacity.

Order A's season timeline, week 8 of a planned 20-week seasonWeeks 1-8: 11,000 soldNow, week 8Weeks 9-20: 4,000 remaining, cover 2.9 weeks at current pace
Order A has 4,000 pieces left after eight weeks, but twelve selling weeks remain in the planned season. The stock cover figure shows those 4,000 pieces would run out far sooner than the season ends if the sales rate holds.
The worked number

Sell-through rate and stock cover, calculated from the week-eight checkpoint

Sell-through rate: 11,000 / 15,000 = 73.3%
Remaining stock: 15,000 - 11,000 = 4,000 pieces
Weekly sales rate over the first eight weeks: 11,000 / 8 = 1,375 pieces a week
Stock cover on the remaining stock: 4,000 / 1,375 = 2.9 weeks
Selling weeks still remaining in the twenty-week planned season: 20 - 8 = 12 weeks

At the current weekly sales rate, the remaining 4,000 pieces will run out in about 2.9 weeks, far short of the twelve selling weeks still remaining in the planned season. This gap between stock cover and the weeks actually remaining is the exact signal Mona is trained to look for before a reorder purchase order is ever confirmed.

The method

Four steps to judge reorder likelihood from sell-through rate and stock cover alone

  1. Calculate the sell-through rate by dividing pieces sold by the total order quantity.
  2. Calculate the weekly sales rate by dividing pieces sold by weeks elapsed.
  3. Calculate stock cover by dividing remaining stock by the weekly sales rate.
  4. Compare stock cover with the selling weeks still remaining in the season to judge whether current stock will run out early.
The trap

A common mistake is treating a high sell-through rate alone as proof that a reorder is guaranteed

A common mistake is reading a rising sell-through rate and assuming a reorder will automatically follow. A sell-through rate of 73.3% only signals a probable reorder once it is read together with stock cover and the season's own remaining weeks; a season already close to its planned end can show the same high sell-through rate while genuinely needing no more stock at all. What this costs a factory that reserves capacity on sell-through rate alone is real: Delta Garments could commit sewing lines to a reorder that Fairway Stores never actually places, if the season was already nearly finished, leaving that capacity unpaid for. Sell-through rate and stock cover must be read against the season's own remaining weeks, never in isolation.

Same sell-through rate, two different points in the seasonWeek 8 of 20: 73.3% sold, 12 weeks leftLikely reorder signalWeek 19 of 20: 73.3% sold, 1 week leftSeason ending, no reorder needed
The same 73.3% sell-through rate means opposite things depending on how many selling weeks are left. Early in the season it signals a likely reorder; late in the season it simply describes a normal end-of-season position.
06In plain words

Sell-through rate tells a factory how much of a style has already sold, and stock cover tells the factory how many more weeks the remaining stock will last at the current pace. Neither number alone says whether a reorder is coming; a factory has to compare stock cover with how many selling weeks the season actually has left. A high sell-through rate early in a season, with stock running out well before the season ends, is a strong signal that a reorder may follow. The same high sell-through rate late in a season, with the stock cover and the remaining weeks lining up, simply describes a season ending as planned.

07Quick check
  • Sell-through rate is pieces sold divided by total order quantity, looking backward at the season so far.
  • Weekly sales rate is pieces sold divided by weeks elapsed, and stock cover is remaining stock divided by that rate.
  • Stock cover must always be compared with the selling weeks still remaining in the season, never read alone.
  • A high sell-through rate early in a season usually signals under-stock and a possible reorder.
  • The same sell-through rate late in a season, with matching stock cover, is a normal end-of-season position, not a reorder signal.
08Workplace scenario

Delta Garments receives Fairway Stores' week-eight sales report and Mona must decide whether to raise a reorder recommendation before a purchase order arrives

Delta Garments receives a weekly sales report passed down the chain from Northline Apparel, based on Fairway Stores' own shop sales of Order A. The report for week eight states that 11,000 of the 15,000 pieces have sold and that the planned season runs twenty weeks in total. No reorder purchase order has been raised by Fairway Stores at this point.

Here is the line from the sales report Mona is reviewing:

Week 8 sales report, Order A. Pieces sold to date: 11,000 of 15,000. Season length: 20 weeks. Reorder purchase order: none received.

Should Mona recommend that Delta Garments reserve sewing capacity for a possible reorder now, before any purchase order arrives? Decide before opening the answer.

Show decision

Yes, Mona should recommend reserving capacity, based on two facts in the sales report.

First, the stock cover of 2.9 weeks is far shorter than the twelve selling weeks still remaining in the season. At the current sales rate of 1,375 pieces a week, the remaining 4,000 pieces will run out with roughly nine selling weeks still left to trade, unless more stock arrives.

Second, this gap between stock cover and remaining season length is exactly the pattern that has preceded a confirmed reorder on comparable styles before, though it does not guarantee one. Waiting for the reorder purchase order to actually arrive before reserving any capacity risks Delta Garments being unable to fit the reorder into its own production schedule in time for the goods to still be useful to the remaining season.

Mona's recommendation should state the stock cover gap plainly and ask Delta Garments' own planning team to hold provisional capacity, without committing fabric or labour until the reorder purchase order is confirmed.

09What it costs

What a missed reorder signal costs a factory's own production schedule

Using Order A's own fixed figures and the week-eight checkpoint:

Pieces of remaining stock at week eight: 15,000 - 11,000 = 4,000 pieces
Weekly sales rate: 11,000 / 8 = 1,375 pieces a week
Weeks until the remaining stock runs out at this rate: 4,000 / 1,375 = 2.9 weeks
Selling weeks left in the season once the remaining stock runs out: 12 - 2.9 = 9.1 weeks

If Delta Garments waits for a confirmed reorder purchase order before reserving any capacity, and the reorder is then confirmed only after the stock has already run out, up to 9.1 selling weeks of the season could pass with the style unavailable at Fairway Stores. A merchandiser who spots the same gap at week eight and reserves provisional capacity early gives Delta Garments' own production schedule the best chance of delivering a reorder while selling weeks remain.

10Working template

Retail maths reference workbook: track sell-through rate and stock cover against the season's own remaining weeks

Open the course workbook's "Sell-through and stock cover" sheet. It records a style's own order quantity, pieces sold, weeks elapsed and total planned season length, then calculates sell-through rate, weekly sales rate, stock cover and the gap between stock cover and remaining selling weeks automatically. Enter a different order's own checkpoint to see how the same reorder-signal method applies to any style.

[Download the Retail maths reference workbook](../../templates/T20-C01-retail-maths-reference-workbook.xlsx)

Download the Retail maths reference workbook (Excel)

11Check yourself

1. At week eight, Order A shows a sell-through rate of 73.3% and a stock cover of 2.9 weeks, against twelve selling weeks still remaining in the season. What does this combination most strongly suggest?

2. A style has an order quantity of 20,000 pieces. By week ten, 9,000 pieces have sold, and the planned season is twenty-five weeks long. What is the stock cover on the remaining stock, and how does it compare with the selling weeks left?

12Glossary
ENARFRTRMeaning
Sell-through rateمعدل البيع الفعليTaux d'écoulementSatış oranıThe share of stock actually sold within a planned period, used to judge whether a forecast was right.
Stock coverتغطية المخزونCouverture de stockStok kapsama süresiThe number of weeks a brand's current stock is expected to last before it runs out, given its normal sales rate.
Weekly sales rateمعدل المبيعات الأسبوعيTaux de vente hebdomadaireHaftalık satış oranıThe average number of pieces of a style sold in one week, found by dividing total pieces sold by the number of weeks elapsed.
Reorderإعادة الطلبRéassortYeniden siparişA repeat purchase order placed against a style the retailer has already sold before, based on its own forecast rather than a new buyer commitment.
Checkpointنقطة فحصPoint de contrôleKontrol noktasıA specific moment in an order's life where its progress is checked against the plan.
13Next

Lesson 1.3: Calculating markup, margin and average selling price together

You now know how to read sell-through rate and stock cover from real sales. The next lesson puts markup, margin and average selling price together on one style, sourced directly from the factory with no wholesale step in between. Back to the course map

14Ladder

RecognizeTell sell-through rate and stock cover apart as two different views of the same sales data.
ConnectSee how a factory reads a retailer's own sales data without ever seeing the shop floor.
CompareWeigh the same sell-through rate read early in a season against the same figure read late in a season.
DecideJudge whether a week-eight checkpoint on Order A justifies reserving factory capacity before a reorder is confirmed.