![]() From stock turnover rate to sell-through rate, this comprehensive guide will help you optimize your inventory management and drive business growth. With a bit of strategic planning and diligence, you can ensure that you are making the most of your inventory and achieving a profitable balance in the long run. Discover the 7+ essential inventory-related KPIs that every clothing retailer should know. Companies calculate their stock turns by dividing the result of an inventory turnover ratio formula (COGS or sales) by the average value of inventory. Inventory Turnover Explained: Definition, Formula & More. The shorter the value stream, the quicker inventory turns. It's difficult to determine what a good inventory turnover is because it depends on your industry and whether you manufacture your products yourself or buy them to resell.īy keeping an eye on your inventory turnover ratio and profitability, you can make informed decisions about your business's stock levels and overall purchasing strategy. Inventory turns are how often stock moves through a business or value stream. » Can decoupling inventory help your online business? Don't Toss and Turn Over Inventory Turnover Anymore According to the Thomson One Banker database, the average merchandise turnover in the retail clothing industry for the 12-month period ending June 2011, was 3.91. Automating ordering processes where possible.Your inventory turnover is calculated by dividing your cost of goods sold by the amount of average dollars invested in inventory over the same 12-month period. ![]() Utilizing software to track purchasing trends and identify potential savings opportunities. In simple terms, 'inventory turns' refers to the number of times you sell your entire inventory, in dollars, over a 12-month period. ![]() Companies calculate their stock turns by dividing the result of an inventory turnover ratio formula (COGS or sales) by the average value of inventory.
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