Inventory Turnover Ratio Explained | Retail Dogma

[@RetailDogma]

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[@ConnorWood-i5x]

You sound young with good business knowledge. As long as you stay dedicated and don't get distracted, you'll get far in life

[@RetailDogma]

This comment is very encouraging. Thank you so much, Connor!

[@Kpo0104]

Cool stuff. Big thanks 👍

[@RetailDogma]

Thank you for watching!

[@AkshaySPillai-p8y]

can you help me with the calculation for this product. Stock Status Date 5 Added Aug 28, 2023 11:14 2 Added Nov 17, 2023 14:26 1 Removed Nov 25, 2023 17:53 1 Removed Dec 04, 2023 14:57 1 Removed Dec 08, 2023 09:59 1 Removed Jan 06, 2024 15:15 2 Removed Jan 20, 2024 12:08 6 Added Feb 23, 2024 11:04 1 Removed Mar 02, 2024 15:34 1 Removed Mar 17, 2024 12:33 5 Added Jul 18, 2024 13:40 1 Removed Sep 21, 2024 15:22 1 Removed Nov 20, 2024 18:15 The above is product history. Now Aug 28th 2023, was the first time the product was added to the inventory. Average cost is $28.78. The doubt regarding starting inventory can be cleared then.

[@mradel18]

Thanks for posting this smart explanation. It's very helpful and clear.

[@RetailDogma]

You're welcome ! :)

[@EMbembi]

How do you calculate the turnover when you have only the closing inventory in your data?

[@RetailDogma]

The closing inventory for the last period (e.g last year) is the beginning inventory for this period. So you will take the closing inventory from the old period and the closing inventory from this period and get the average.

[@EMbembi]

@@RetailDogma thank you so much!

[@p-kay64bggoldenboy16]

@@RetailDogma how do you calculate the turnover when there is no closing inventory for the last year, and only given the closing for current year

[@RetailDogma]

the closing for this year alone is not enough, you need at least 2 data points to get the average.

[@hanadygheriany6021]

Thank you so much!

[@RetailDogma]

You're welcome, Hanady! Thank you for watching.

[@samanrohitha4535]

how do you calculate company has sold 2 times and company b 3 times

[@tranhanacci009]

It's so cool, thank you! May I ask why COGS/Average Inventory = IT, so if IT is expected to be high, then COGS is also expected to be high right? But is it good for the COGS to be high, bc it means production cost is high, or maybe is it related to high sales?

[@tranhanacci009]

And may I ask if there is any relation between IT and cumulated issues?

[@RetailDogma]

You're right. COGS here shows sales level. IT could be high if COGS (sales) are high or Average Inventory is low. It's an efficiency metric that shows if the cash invested in inventory is being cycled optimally. If it's too low, it means a lot of cash is trapped in idle inventory, which is not an efficient use of cash. If IT is too high, however, it might signify very low inventory levels at the business, which could lead to lost sales. It's a good practice to compare IT level to benchmarks, because it differs from retail segment to another. Sorry, not sure what cumulated issues are.

[@tranhanacci009]

@@RetailDogma Wow, thank you so much for the detailed and helpful answer. I've already subscribed to your channel for more great videos!

[@RetailDogma]

Our pleasure!

[@soha1b__]

Thanks

[@RetailDogma]

You're welcome! Thank you for watching :)

[@कॉम्पिटिशन_एग्जाम]

Post some more video regarding electronic appliances store video and about their reports

[@कॉम्पिटिशन_एग्जाम]

Damnn post more video