Inventory Velocity & Cashflow Simulator
Model your reselling business over time. See how sell-through speed, cash invested, and time per item affect your monthly profit—and how much cash stays tied up in inventory.
How to Use This Simulator
- 1.Enter your starting capital and sourcing pace
- 2.Set your average sale price and profit margin
- 3.Adjust sell-through speed (days to sell)
- 4.Review cashflow, bottlenecks, and projections
Understanding Inventory Velocity
The Cash Conversion Cycle: Every dollar you spend on inventory is "locked" until that item sells and you get paid. If your average days-to-sell is 45 and platform payout takes 3-5 days, you're waiting 50 days to recover each dollar.
Time is Your Scarcest Resource: Many resellers focus on profit per item but ignore time. If you spend 60 minutes total per item and net $8, you're making $8/hour—below minimum wage. This simulator calculates your effective hourly rate to help you spot this trap.
The Bottleneck Question: Your business is limited by one of three things: (1) cash available to buy inventory, (2) time to source/list/ship, or (3) sell-through speed. Knowing which constraint matters most tells you where to focus improvement efforts.
Common Questions
What is sell-through rate in reselling?
Sell-through rate measures what percentage of your inventory sells within a given period (usually monthly). A 30% monthly sell-through means 30 out of 100 items sell each month. Higher sell-through = faster cash recovery, but often means lower margins or more time spent sourcing.
Why does cash tied up in inventory matter?
Money sitting in unsold inventory can't be used to buy new items, pay bills, or earn interest. If you have $2,000 in inventory with 45-day average sell time, you're essentially giving yourself a $2,000 interest-free loan that takes 6 weeks to repay. This "cash conversion cycle" is critical to scaling.
What's a good sell-through rate for resellers?
It varies by category: clothing typically sees 20-40% monthly sell-through, electronics 30-50%, collectibles 10-25%. Higher isn't always better—fast sell-through often means you're underpriced. Aim for balance: healthy margins with 30-60 day average time to sell.
How do I improve my cashflow as a reseller?
Key levers: (1) Reduce days-to-sell via better photos/descriptions/pricing, (2) Source faster-moving categories, (3) Reinvest profits strategically, (4) Mark down stale inventory to free cash, (5) Reduce time per item to improve effective hourly rate.
Related Tools
This simulator uses simplified models. Actual results depend on sourcing quality, market conditions, platform changes, and individual execution. Sell-through rates vary significantly by category, season, and pricing strategy. This is not financial advice.