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Fashion ecommerce
Inventory Days on Hand (DOH)
Inventory days on hand (DOH) measures how long, on average, a unit of inventory sits before being sold — a key efficiency metric for fashion retailers that indicates demand health and working capital efficiency.
What this means
DOH is calculated by dividing average inventory value by the cost of goods sold per day. A lower DOH means inventory is converting to revenue quickly; a higher DOH means capital is sitting on shelves or in warehouses rather than generating returns. Rising DOH across the industry is a signal of a broader demand-matching problem: brands are producing or stocking inventory that isn't moving at the expected pace, often because the right products aren't reaching the right shoppers at the right moment.
Why it matters for fashion brands
McKinsey's State of Fashion 2026 reports that DOH reached a 14-year relative high in 2024, 14% above pre-2020 averages. Higher DOH means more capital tied up in unsold stock. AI that converts slow-moving inventory to sales reduces DOH and improves working capital.
Related terms
Dead Inventory — Product that has sat in a catalog with low or zero sales velocity, typically requiring markdown. Full-Price Sell-Through — The percentage of inventory sold at original retail price, before markdowns or promotions. Return Rate — The percentage of orders returned by customers after purchase.
See the dead inventory revival use case
See how Elara moves slow-moving inventory to reduce days on hand.