Weeks of Cover (WOC)
A metric fundamental to managing your supply chain is weeks of cover (WOC). Weeks of cover tells you how long the current inventory you have on hand will last based on current sales.
By keeping your eye on weeks of cover you can avoid inventory stock outs and lost sales.
Weeks of Cover (WOC) is an inventory measure calculated by dividing current inventory by average sales over a number of weeks in the past. WOc helps to educate a planner to think of inventory in terms of time.
Weeks of Cover is sometimes also referred to as Weeks of Supply (WOS) but in essence they both mean the same.
Weeks of Supply is an uncomplicated calculation, taking the inventory position for a period (i.e., month) and dividing it by the average sales for the period.
WOS requires no complex behavior for exhausted sales, since the measure looks at past trend versus future sales projection.
Inventory level: € 8,000.00
Total sales of product for the past 8 weeks is: € 16,000.00
Average weekly sales = 16,000 / 8 = of $2,000.00
Weeks Stock = $8,000.00 / $2,000.00 = 4
In this example, you have stock on hand for the next 4 weeks.