Inventory Aging: How to Track, Analyze & Improve It

“Why is this product still sitting in my warehouse after six months?”

Ever found yourself asking that while going through your inventory?

You stocked up expecting demand.

But some SKUs just aren’t moving. Instead, they sit in storage, tying up your cash, eating into your margins, and taking up shelf space that could be used for star products.

That’s inventory aging.

It’s one of the earliest signs that something isn’t right in your inventory planning. If you don’t address it early, you end up with stock you can’t sell, inaccurate forecasts, and a supply chain that gets harder to manage with time.

We break down what inventory aging is, why it happens, and how to manage it before it starts hurting your business.

What is Inventory Aging and Why is it Important

Inventory aging measures how long stock has been sitting unsold in your business, essentially, how old your inventory is. 

It shows how quickly or slowly products move, typically broken into brackets like 0–30, 31–60, 61–90, and 90+ days.

Tracking aging inventory is key to understanding demand patterns and making smarter, data-backed purchasing decisions.

Here are more reasons why it matters.

• Cash flow impact: Stock that sits too long ties up cash flow and reduces working capital
• Risk of obsolescence: Aged inventory increases the risk of markdowns, write-offs, or becoming unsellable
• Storage efficiency: Identifying slow-moving or aging products helps prevent overstock and free up storage space
• Demand insights: Regular tracking highlights trends so you can adjust purchasing, pricing, or marketing
• Profitability: Proactively managing aging inventory supports healthier turnover rates and steadier profits

Types of Aged Stock

Now, aging inventory isn’t just products nearing expiry. There are different types of aged stock, each with its own impact on your business. These include

1. Slow-moving stock 

Slow-moving stock is inventory that still sells, but slower than expected. It quietly takes up shelf space and ties up cash that could be used for faster-selling products. 

You’ll usually notice it when certain items sit in your Shopify store or dashboard for weeks with only a few orders trickling in. 

2. Obsolete inventory

Obsolete inventory is the stock that has lost all market demand and is no longer sellable at its intended price. 

This usually happens when styles change, customer preferences shift, or the product expires.

You’ll notice it when discounts stop working and items just sit, untouched. 

3. Dead stock

Dead stock refers to items that neither qualify as slow-moving nor obsolete.

They generate little to no demand, with minimal potential to sell, and often end up stuck in storage indefinitely. 

You usually spot them when they appear in your Shopify account month after month with zero or near-zero sales. 

4. Perishable goods

Perishable goods are products that spoil, decay, or lose their value quickly if not sold or used within a specific time frame. 

They usually have a short shelf life and require careful storage conditions (like refrigeration).

With Prediko, you can create dedicated views for each of these categories, making it easy to track, flag, and act on aged stock before it hurts your bottom line.

Risks and Consequences of Inventory Aging

As inventory sits longer on shelves, it creates challenges that go beyond lost sales. Here are the key risks and consequences to watch for. 

1. Capital locked in unsold inventory

When stock doesn’t move, working capital stays tied up in products that aren’t generating revenue. You’ve paid suppliers, but can’t recover that cost until those units sell.

This limits how much you can reinvest into new orders, ad campaigns, or fast-selling SKUs, slowing down the parts of the business that are actually performing.

Solution

Review inventory aging reports weekly to identify stock at risk of sitting beyond 60–90 days.

Pause reorders, shift excess to bundles, or run limited-time offers to recover cash before markdowns become unavoidable.

2. Distorted forecasts and bad replenishment decisions

When aged inventory builds up, it skews your sales and demand data.

‍Forecasting models may overestimate demand for products that are no longer moving, leading you to reorder items that don’t sell. 

This not only locks up more cash in slow or dead stock but also creates gaps in availability for products your customers actually want.

Over time, these distorted signals result in poor replenishment decisions and reduced forecasting accuracy.

Solution

Assign an age to your inventory before running replenishment logic. 

Filter out SKUs that haven’t moved in 60+ days from automated reorder triggers, and base forecasts on sell-through, not stock on hand.

3. Obsolescence and dead stock 

Inventory that sits too long often ends up unsellable. It could expire, go out of trend, or just lose market relevance, especially in seasonal or fast-moving categories.

This isn’t just about storage costs. Dead stock becomes a sunk cost on your balance sheet, drags down margins, and eventually needs to be written off.

Solution

Set up alerts for SKUs that cross 90 or 120 days of inactivity.

Push these through aggressive clearance, bundling, or donation channels before they lose all retail value.

How to Calculate Inventory Aging 

Inventory aging is usually measured with an aged stock report, which groups stock into time brackets based on how long it has been in storage. 

The most common brackets are 0–30 days, 31–60 days, 61–90 days, and over 90 days, giving you insight into what’s selling quickly and what is sitting too long.

To calculate it, you’ll need two key pieces of data.

• The date the stock was received
• The current date or reporting date

Subtract the received date from the current date to find the age of each product, then place it in the correct bracket.

For example, if you received 100 units of a t-shirt on June 1st and today is September 1st, those units fall into the 91+ days bracket.

A full inventory aging report will do this across your entire catalog, so you can see where your cash is tied up.

While you can track this manually, the process is time-consuming and error-prone. Automating it ensures accuracy and frees up your team’s time. 

Prediko handles the entire process for you, automatically calculating inventory aging, providing multiple stock views, and helping you plan ahead. 

As an all-in-one inventory management platform, Prediko brings everything you need into one place so you can see your data clearly and act on it. We’ll dive into how it works a little later.

What is An Inventory Aging Report

An inventory aging report shows how long products have been in stock, grouped into time brackets such as 0–30 days, 31–60 days, 61–90 days, and over 90 days.

The report gives you a clear picture of which products are selling quickly and which ones are tying up working capital.

For a Shopify store owner, an inventory aging report example answers practical questions: Which products should be reordered, which should be discounted, and which need to be written off. 

Strategies to Manage and Reduce Inventory Aging

The strategies below are tailored for Shopify brands to reduce aged inventory or overstocks, unlock tied-up capital, and maintain a healthier inventory turnover.

1. Improve demand forecasting accuracy 

Accurate demand forecasting helps you predict how much stock customers will actually buy in the coming weeks or months. 

When done right, it prevents two common drivers of inventory aging: products sitting too long in storage due to over-ordering, and stockouts that force last-minute purchases of the wrong items.

Many stores start with spreadsheets, but as operations scale, they quickly fall short.

As one Reddit user put it: “Spreadsheets break not because they’re manual, but because they don’t surface error patterns early. Most misses come from lag in syncing sales velocity with actual supplier lead time, not stock counts.”

And that’s the real issue. The challenge isn’t simply tracking what’s on hand; it’s aligning sales velocity with supplier lead times.

Spreadsheets rarely capture that, which leads to delays, miscalculations, and capital tied up in the wrong products.

An AI-powered platform such as Prediko connects sales data with supplier lead times, reordering rules, and safety stock, updating forecasts automatically as demand shifts.

Instead of reacting to problems after they occur, you spot them early and respond with confidence.

2. Regular audits & aging analysis

Inventory data is only useful if it reflects reality. That’s why routine audits, paired with aged inventory analysis, are essential to keeping stock under control. 

Audits confirm that the stock you think you have matches what’s actually on the shelves, while aging analysis reveals how long products have been sitting and which are at risk of becoming dead stock.

By combining two, you gain both accuracy and insight. Regular audits help spot errors before they grow costly, while aging reports highlight slow movers that need discounting, bundling, or smarter replenishment. 

Research on 24,000 SKUs in grocery retail found that stores doing regular audits saw an 11% sales lift because mismatches between records and reality were caught early. 

Here’s how to do it well:

• Set a consistent audit schedule, even once a month, can make a big difference
• Match physical counts against system records and resolve discrepancies immediately
• Review aging buckets to identify SKUs that repeatedly get stuck in older brackets

3. FIFO (First-In, First-Out)

FIFO means the stock that comes in first should be the stock that goes out first. It keeps older units moving before they turn into dead or expired inventory. 

This matters most with products that expire, but it’s just as useful with seasonal goods or anything that risks losing relevance over time.

Take skincare as an example. If you receive one batch of face creams in May and another in July, you must sell the May batch first to make sure nothing expires on the shelf.

When FIFO isn’t followed, newer stock may get sold first, leaving older units unsellable.

With Prediko, FIFO is built into the system. Stock incoming dates are tracked automatically, and you’re shown which products need to move first so nothing quietly ages out in storage.

4. Promotions & bundling strategies

Use promotions and bundles to move the aged stock.

The idea is simple: pair slower items with products your customers already want, and you create value without making the discount look forced.

Kylie Cosmetics does this at scale with their “Bundles & Sets” section.

Gift sets combine multiple products, sometimes pairing staples with less popular shades or limited-edition items. 

Customers see it as a deal and are more likely to purchase, while the brand reduces the risk of unsold units quietly aging out on the shelf.

It’s a win-win: shoppers get curated value, and the business keeps inventory moving.

5. Inventory classification 

Not every product in your catalog moves at the same pace. Some bring most of your revenue, others sell steadily, and a few sell often but add little profit.

‍ABC analysis separates these groups so you know where to focus your time and effort. 

• Category A items are the high-value products that generate the majority of sales
• Category B items sit in the middle; important, but not as critical
• Category C items are the low-value products that sell frequently but add less to your bottom line

By focusing on what matters most, you prevent overstocking low-impact items that might sit aging on shelves, while keeping your best-sellers consistently available.

6. Supply chain flexibility

Inventory aging often occurs when the supply chain lacks flexibility.

If lead times are rigid or suppliers can’t adjust order quantities quickly, you end up ordering buffer stock that just sits aging on shelves. 

Flexibility solves this by giving you room to respond.

That could mean working with multiple suppliers instead of relying on one, negotiating smaller but more frequent shipments, or keeping backup options for critical SKUs. 

7. Use inventory management software 

One reason inventory keeps aging is slow decision-making. By the time you notice a problem in spreadsheets, weeks have already passed, and products have lost their chance to sell. 

An inventory management software removes that lag by giving you real-time visibility into what’s moving, what’s stuck, and what needs attention.

With the right system, you’re not waiting for the end of the month to run a report. You can see today that a product is slipping into the 60–90 day bucket and decide whether to discount, bundle, or stop reordering.

That speed is what prevents aged stock from building up quietly in the background. 

With Prediko, this process is automatic. The platform connects to your Shopify store and generates real-time aging reports, showing which SKUs are slipping into the 60–90 day range or sitting beyond 90+. 

Instead of just showing numbers, Prediko flags SKUs that are running low or overstocked, recommends purchase actions, and, by factoring in supplier lead times, tells you exactly when to pause or scale back reorders.

Metrics for Aged Inventory Analysis

The following metrics help break down aged inventory into actionable insights. 

1. Inventory turnover ratio

Inventory turnover measures how frequently you sell and replace stock within a set period. 

A higher turnover ratio signals efficient demand planning and strong sales velocity, while a lower ratio suggests aged stock, poor purchasing decisions, or weak product performance.

Formula: Inventory Turnover = Cost of Goods Sold (COGS) ÷ Average Inventory

2. Days inventory outstanding (DIO)

Days Inventory Outstanding (DIO) measures the average number of days stock stays in inventory before being sold. 

A lower DIO reflects faster turnover and healthier cash flow, while a higher DIO shows products are sitting too long and risk becoming obsolete.

Formula: DIO = (Average Inventory ÷ Cost of Goods Sold) × 365

3. Sell-through rate

The sell-through rate measures the percentage of inventory sold compared to the total received over a specific period. 

A high sell-through shows strong alignment between purchasing and demand, while a low rate indicates underperforming products that may be aging in storage.

Formula: Sell-Through Rate = (Units Sold ÷ Units Received) × 100

4. Carrying costs 

Carrying Costs represent the total expense of holding inventory, including storage, insurance, depreciation, and labor. 

When carrying costs rise, it’s often a sign of inefficiencies caused by excess or aged stock tying up working capital.

Formula: Carrying Costs = (Total Carrying Costs ÷ Average Inventory Value) × 100

How Prediko Helps Manage and Control Inventory Aging 

For most Shopify brands, inventory aging only becomes visible once it’s already hurting cash flow or clogging up warehouse space.

You notice it when SKUs stop moving, not before. 

Prediko changes that by surfacing aging risks early, so you can act before products turn into liabilities.

Here’s a deep dive into how it helps manage and reduce aging stock, feature by feature.

• Real-time inventory and aging data: See your entire catalog grouped into aging buckets (0–30, 31–60, 61–90, 90+ days) using the “Days Left” as a filter. Data updates automatically with every sale and stock movement, giving you early visibility before aging turns into write-offs.

• Demand-based replenishment recommendations: Prediko analyzes sell-through and velocity to recommend what to reorder and what to pause. This prevents overstocking slow movers and keeps working capital free for faster sellers.

• ABC inventory classification: SKUs are automatically tagged by contribution value. Paired with aging data, this helps you prioritize which stock to act on first and which to deprioritize without major impact.

Prediko gives you more than just a stock aging report. It gives you control. 

You can see where aging is likely to happen, act on it early, and build a planning process that doesn’t leave aging stock to chance.

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FAQs

1. How to make an inventory aging report in Excel?

List all SKUs with their stock quantities and last sale or movement dates. Use =TODAY()-[Last Sale Date] to calculate the age in days, then group items into aging buckets, such as 0–30, 31–60, 61–90, and 90+ days.

2. How to reduce aging inventory?

Improve forecasting, run regular audits with aging analysis, and use bundles or targeted promotions to move slow stock. Prioritize action using methods like ABC classification.

3. How to calculate inventory aging in Excel?

Apply the inventory aging formula, which is =TODAY() - [Last Sale Date] to each SKU to get the number of days in stock. Use filters or pivot tables to analyze aging by category, product type, or supplier.