The Hidden Conversion Engine: How to Build a SKU Velocity Map That Drives Profit Without Guesswork

Most ecommerce founders focus hard on top-line growth; they watch revenue, ROAS, and AOV like it’s the only thing that matters. But, the real key to steady profits is buried deeper—in SKU velocity, a metric that shows what’s selling, when, and why, helping you predict inventory, pricing, and cash flow needs.

Table of Contents

• What Does SKU Velocity Mean for Your Store?

• How to Figure Out SKU Velocity

• Step-by-Step: Create Your SKU Velocity Map

• Automate Your Map with Google Sheets

• Use SKU Velocity Data to Boost Profits

• Conclusion

• FAQs

What Does SKU Velocity Mean for Your Store?

SKU velocity tracks how fast each product sells over a set time. It’s not just about total sales—it shows the rate at which a product moves.

Say you sell shirts in red, black, and blue:

• Red moves 300 units a month.

• Black moves 100 units a month.

• Blue moves 50 units a month.

Red looks like the best seller, but if you’ve got 10,000 red shirts in stock, selling 300 a month means it’s not moving fast enough for the space it takes up. Velocity adds context to sales numbers. It helps you predict stockouts, decide which products to push in ads, and figure out true profit margins per SKU when paired with margin and restock time data.

SKU Velocity Example
Velocity shows the real story behind sales.

How to Figure Out SKU Velocity

Here’s the basic way to calculate it:

SKU Velocity = Units Sold / Time Period (days or months)

For a 30-day view:

Rolling Velocity = (Units Sold in Past 30 Days) / 30

To see how long your stock will last:

Days Until Stockout = Current Inventory / Rolling Velocity

These formulas help you see what’s moving fast and what’s sitting too long. Use them to start building your map.

SKU Velocity Formula
Simple math reveals product speed.

Step-by-Step: Create Your SKU Velocity Map

You’ll need a spreadsheet or tool like Airtable or Looker Studio. Set up these columns:

• SKU ID

• Product Name / Variant

• Units Sold (30 Days)

• Inventory on Hand

• Restock Time (days)

• Unit Cost

• Unit Price

• Gross Margin (%)

Then calculate these:

• Velocity (units/day)

• Days Until Stockout

• Revenue/Day by SKU

• Profit/Day by SKU

These columns let you sort products not just by sales, but by profit and speed. This helps you focus on what really drives your bottom line.

SKU Velocity Map Setup
Organize your data to spot winners.

Automate Your Map with Google Sheets

Want to update your map weekly without extra work? Use Google Apps Script in Google Sheets.

Here’s a script to automate it:

javascript

function calculateSkuVelocity() {
  var sheet = SpreadsheetApp.getActiveSpreadsheet().getSheetByName("SKU_Velocity");
  var data = sheet.getDataRange().getValues();

  for (var i = 1; i < data.length; i++) {
    var unitsSold = data[i][2]; // Column C: Units Sold (30 Days)
    var inventory = data[i][3]; // Column D: Inventory on Hand
    var unitCost = data[i][5];  // Column F: Unit Cost
    var unitPrice = data[i][6]; // Column G: Unit Price
    var restockTime = data[i][4]; // Column E: Restock Time

    var velocity = unitsSold / 30;
    var daysUntilStockout = inventory / velocity;
    var margin = ((unitPrice - unitCost) / unitPrice);
    var revenuePerDay = velocity * unitPrice;
    var profitPerDay = velocity * (unitPrice - unitCost);

    sheet.getRange(i + 1, 9).setValue(velocity); // Column I
    sheet.getRange(i + 1, 10).setValue(daysUntilStockout); // Column J
    sheet.getRange(i + 1, 11).setValue(revenuePerDay); // Column K
    sheet.getRange(i + 1, 12).setValue(profitPerDay); // Column L
  }
}

Run this weekly. Connect your inventory system, like Shopify or Cin7, using Zapier or a CSV export to pull data automatically.

Google Sheets Automation
Automate your map to save time.

Use SKU Velocity Data to Boost Profits

Now that you have your map, here’s how to use it:

• Shift Ad Spending: Don’t just promote top sellers; focus on SKUs with the best profit-per-day, using velocity times profit/day to find them.

• Catch Overstock Early: Low velocity with high stock means wasted money; bundle these items or sell them on Amazon or TikTok Shop instead of discounting.

• Plan Cash Flow: High-velocity SKUs with thin margins can hurt cash flow if restocks are slow; add a buffer for anything over 2 units/day.

• Guide Product Choices: If some variants always move slowly, drop them; let velocity data decide what to keep or add.

These steps help you make smarter choices for your store. Check your map weekly to stay on top of trends.

Actionable SKU Data
Turn velocity into profit strategies.

Conclusion

SKU velocity is the metric most ecommerce founders overlook, but it’s the key to steady profits. By building a SKU velocity map, you can manage inventory, tweak pricing, and improve cash flow without guesswork in 2025. Subscribe to Bowtied Parrotfish for more ecommerce strategies.

FAQs

Q: What is SKU velocity?
A: It measures how fast a product sells over time, showing the rate of movement.

Q: Why does velocity matter more than sales?
A: It shows how products perform relative to stock, not just total sales.

Q: How do I calculate SKU velocity?
A: Divide units sold by the time period, like units sold in 30 days divided by 30.

Q: What tools can I use for a velocity map?
A: Google Sheets, Airtable, or Looker Studio work well.

Q: How often should I update my map?
A: Update it weekly to keep data fresh.

Q: Can velocity help with ad spend?
A: Yes; focus ads on high-profit, fast-moving SKUs.

Q: How do I connect my inventory data?
A: Use Zapier or export a CSV from Shopify or Cin7.

Q: What if a product has low velocity?
A: Bundle it with faster items or sell it on other platforms.

Q: Can small stores use this method?
A: Absolutely; it works for any store size.

Drive profits with a SKU velocity map. Subscribe to Bowtied Parrotfish for more tips.