What does "sell-through rate" measure?

The sell-through rate is a crucial metric in retail and merchandising that specifically measures the percentage of inventory sold within a specified period. This metric provides valuable insight into how effectively stock is being sold relative to what has been received or available for sale.

When a retailer understands their sell-through rate, they can assess the demand for a product, recognize trends, make informed purchasing decisions, and adjust their inventory levels accordingly. A high sell-through rate typically indicates strong sales performance, while a low rate may suggest overstock or issues with product appeal. Therefore, it serves as a key performance indicator for inventory management and sales effectiveness.