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Inventory Shrinkage Calculator

LAST UPDATE: August 17th, 2018

Calculator

What is inventory shrinkage?

Shrinkage is the difference in book value and actual value of inventory in an organization.

Shrinkage of 100% means that the current value of inventory is the same as the book value of the inventory.

Shrinkage of less than 100% means that the current value of inventory is less than the book value of the inventory.

Shrinkage of more than 100% is very rare but possible. It means that the current value of the inventory is more than the book value.

Formula

Inventory Shrinkage = ((Book Value – Current Value) / Book Value) x 100%

Example

A store has an inventory book value of $15,000 and a current inventory value of $14,000.

Inventory Shrinkage = ((15,000 – 14,000) / 15,000) x 100% = (1,000 / 15,000) x 100% = 0.0667 x 100% = 6.67%

Therefore, this store has a shrinkage rate of 6.67%.

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