What should my inventory turns be

Inventory turnover is a key performance indicator KPI for managing and growing your business. The measurement also shows banks how liquid your assets are. Since inventory is often put up as collateral for a loan, banks want to make sure the inventory is easy to sell and can quickly be turned into cash.

Closely monitoring stock turn also gives you a better handle on your inventory so you can make smarter purchasing decisions, keep merchandise moving, and sell more of the products your customers want. We compiled some of the most important metrics that you should track in your retail business, and put them into easy-to-use spreadsheets that automatically calculate metrics such as GMROI, conversion rate, stock turn, margins, and more.

If your apparel store has a stock turn rate of 4. The Business Development Bank of Canada has an inventory turnover calculator with benchmarking capabilities. Your sales team, purchasing managers, marketing executives, and senior management need to share information about inventory.

Keep each other in the loop regarding what products are flying off the shelves and which items are not generating any interest. Here are some of the ways the various teams can work together:. If you have a smaller retail operation, it still helps to keep your employees in sync.

The best thing to do is to explore the various strategies and tactics and see what works best for your store. Knowing which products to stock and how much to order are game-changing insights to your retail business. Having a solid handle on your inventory turn allows you to stay on top of those decisions so you can continue carrying the products at the right time.

Your point of sale system is the center of all communication in your retail store. It needs to be fast, easy to use with a robust feature set to help you effectively manage all aspects of your retail business including inventory. Contact a consultant to learn more about Epos Now! We use cookies to give you the best experience on our site. By continuing, you agree to our use of cookies.

Written by Kadence Edmonds. Go Back. What is inventory turnover? Inventory turnover formula So, how do you accurately calculate stock turnover? What is a good inventory turnover ratio for retail? This ratio can help businesses make decisions about: What items need to be ordered and how much? What products may need to be put on sale? Preplan orders allowing for lead time? Other benefits: Improves cash flow and reduce overall costs Centralises and automates all business data Provides easy barcode management Create ways to sell slow-moving inventory If you have identified that your inventory turnover is slow, then it may be time to ramp up sales and marketing efforts to try and sell more products.

Some sale ideas: Train staff to upsell items or cross-sell promotions Encourage suggested selling Set sales targets and incentivize your team to reach it Train staff on effective selling techniques Review visual merchandising Have a time-sensitive sale on slower inventory lines Proper forecasting There are a number of varying factors that can impact inventory levels, including seasonal demand, occasional products, and trends.

Effective marketing Your business' marketing strategy could be a crucial tool in improving inventory turnover rates. Have an easy to navigate website Email marketing Loyalty programs Paid advertising Have an SEO strategy to improve search results Smart pricing strategies Pricing is tricky, especially if your business sells products on a global scale through an ecommerce platform.

These can include: Occasional items that have to be sold by a certain time ie. Christmas and Easter supplies Seasonal variances Shipping costs Bulk buy discounts Current trends Improve your inventory turnover ratio with a POS system that can do it all Your point of sale system is the center of all communication in your retail store.

Offer ends in 5 days 17 hours 13 minutes 53 seconds. Aside from promotional tactics, it's important to consider how else you could you be lowering your inventory costs? With the right reporting structure in place, the better equipped you are to understand your inventory performance. In fact, once you know what your best-sellers are, you could see if you could negotiate a better price with your suppliers by purchasing more in bulk. Alternatively, could look at other ways to lower costs, for example by negotiating extended credit options.

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Linnworks Partners. Support Center. Resource Hub. Login Book a demo. Platform Overview. Inventory Management. Linnworks connects, manages and automates commerce operations, powering businesses to sell everywhere their customers are and capture every revenue opportunity. Helping you reach your customers wherever they spend their time. Partner Login. Become a Partner. Join with Linnworks to bring additional value to your customers.

The Linnworks Partner Program connects our merchants to the best solutions in the industry so customers can seamlessly connect their business systems and achieve commerce control. Get the knowledge and inspiration you need to expand your business. Written by: Aimee Manning.

But what does inventory turnover actually mean? And how do you calculate it?