How Bookstock AI Calculations Work
Complete transparency on how we analyze your inventory data and calculate every metric.
Our Approach to Inventory Analysis
Bookstock AI uses the same calculations that inventory professionals have used for decades, but automates the entire process. We do not use black-box AI that makes unexplainable decisions - every metric is calculated using standard, proven formulas that you can verify.
When you upload your data, our system identifies relevant columns (SKU, quantity, cost, sales data) and applies the appropriate calculations to each row. The AI component handles column mapping and data interpretation, while the actual metrics use straightforward mathematics.
Core Metrics and Formulas
Average daily sales is calculated from your sales data over the available period. If you provide 30 days of sales, we divide total units sold by 30 to get the daily rate. Items with zero sales show "No Sales" rather than infinite days.
- Critical: DOH less than 7 days
- Low: DOH between 7-21 days
- Healthy: DOH between 21-60 days
- Overstock: DOH greater than 60 days
These thresholds are industry-standard starting points. Your optimal ranges may vary based on supplier lead times and product characteristics.
We calculate margin as a percentage of the selling price (not markup on cost). This is the standard retail margin calculation showing what percentage of each sale is gross profit.
Total inventory value is calculated at cost price, which aligns with standard accounting practices. This represents the capital currently invested in inventory.
Sales velocity shows how fast each item sells on average. This is the same figure used in the DOH calculation but presented separately for clarity.
We calculate suggested reorder points based on a default 14-day lead time and 7-day safety stock. The formula determines the stock level at which you should place a new order.
Summary Statistics
The dashboard summary cards show aggregated metrics across your entire inventory:
- •Total SKUs: Count of unique products in your data
- •Total Stock Value: Sum of all (Quantity × Cost Price)
- •Average Margin: Mean of all individual product margins
- •Items at Risk: Count of SKUs with Critical or Low DOH
Data Requirements
For accurate calculations, your data should include:
Required
- • Product identifier (SKU/code)
- • Current quantity on hand
- • Cost price per unit
Recommended
- • Selling price per unit
- • Sales quantity (period)
- • Product description
Privacy and Data Handling
All calculations happen in your browser. Your inventory data is not uploaded to our servers or stored anywhere. When you close the browser or refresh the page, your data is gone. This desktop-only approach ensures your sensitive business information remains completely private.