Inventory turnover ratio is one of the important metrics that tells a business of its performance.
It is very essential to have at least a yearly analysis of your inventory turnover ratio and direct your operations accordingly.

What is inventory turnover ratio?

Inventory turnover ratio is the rate at which inventory is ‘turned’ or sold by a company. It shows the company’s ability to convert its inventory into cash.
One of the most important factors determining the success of a business is its efficiency in inventory management. The entire inventory that lies piled up in a warehouse is worth the storage and many other costs that the seller has to pay. So, the faster the inventory is sold out, the better.

How to calculate inventory turnover ratio?

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Premna is the Digital Marketing Analyst at Primaseller. She is an avid reader and an adrenaline junkie. When she's not working, you can find her exploring food joints, watching movies or TV shows, or working out.