Stock-to-Sales Ratio
Stock-to-Sales Ratio (SSR) is a retail planning metric that compares the amount of inventory on hand at the beginning of a period to the net sales made during that period — used to evaluate inventory adequacy and identify over- or under-stocked positions.
Stock-to-Sales Ratio (SSR) is a retail planning metric that compares inventory on hand at the beginning of a period to the net sales generated during that period:
SSR = Beginning of Period Inventory ÷ Net Sales for Period
An SSR of 3.0 means the brand held three times as much inventory as it sold in that period. An SSR of 1.5 means inventory was 1.5× the period's sales volume.
SSR is used to assess whether inventory levels are appropriately sized relative to the rate of sale — identifying both over-stocked positions (high SSR, potential markdown risk) and under-stocked positions (low SSR, potential stockout risk).
How SSR is used in apparel planning
Setting planned SSR targets: Before the season, planned SSR targets by category define the intended inventory-to-sales relationship. A category planned at SSR 2.5 with $200K in expected monthly sales implies $500K in beginning-of-month inventory.
In-season monitoring: Actual SSR tracked against planned SSR signals inventory imbalance. A category running SSR of 4.0 against a planned 2.5 is over-inventoried relative to demand — either sales are underperforming or inventory arrived early.
OTB calibration: SSR targets are an input to the OTB model. If planned BOM inventory needs to support a target SSR at the expected sales rate, the OTB framework can derive the required receipt budget to maintain that relationship over time.
SSR vs Weeks of Supply
SSR and Weeks of Supply measure similar things at different time scales:
| | Stock-to-Sales Ratio | Weeks of Supply | |---|---|---| | Period | Monthly | Weekly | | Expression | Ratio (3.0×) | Weeks (6 wks) | | Common use | Financial planning | Operational replenishment |
SSR is typically used at the financial planning level; Weeks of Supply at the operational level for replenishment decisions.
Apparel-specific SSR considerations
SSR must be interpreted within the seasonal context of apparel. An SSR that looks high at the start of a season (when inventory arrives but the sell window hasn't fully opened) may be entirely appropriate. The same SSR at the end of a season signals markdown risk.
A single SSR number without seasonal context is misleading. A February SSR of 4.0 for a brand entering spring season is different from the same SSR in April when spring should be selling at peak rate.
RetailNorthstar tracks SSR by category against planned targets throughout the season, providing a real-time view of inventory adequacy and signaling where OTB adjustment may be needed.