Lore

Inventory Budget Formula (Days × Daily Sales × Unit Cost)

Overview

A sizing formula for a new product's first inventory order: target days-of-stock × daily unit sales × per-unit cost = inventory dollar budget, which also yields the total unit count to order.

Worked example from a real launch: ~100 days × 25 units/day × $5/unit ≈ $4,000 budget / ~800 units.

Application