How is the inventory to sales ratio calculated in the app
Inventory to Sales Ratio is a financial metric that compares the amount of inventory a company holds to its sales over a specific period. This ratio helps businesses assess how well they are managing their inventory in relation to their sales volume.
SKU: Stock Keeping Unit, a unique identifier for your product variants.
Inventory to sales ratio: how many times of the amount of inventory a company holds per sales over a specific period
Average inventory value: the average value of inventory during the period.
Beginning inventory value: The initial inventory at cost of a specified historical period.
Ending inventory valye: The inventory at cost at the end of a historical period.
Net sales: the net revenue excludiing refunds, shipping fees and taxes.
Terms and formula
SKU: Stock Keeping Unit, a unique identifier for your product variants.
Inventory to sales ratio: how many times of the amount of inventory a company holds per sales over a specific period
[Average Inventory Value] / [Net Sales]Average inventory value: the average value of inventory during the period.
( [Begingin Inventory Value] + [Ending Inventory Value] ) / 2Beginning inventory value: The initial inventory at cost of a specified historical period.
Ending inventory valye: The inventory at cost at the end of a historical period.
Net sales: the net revenue excludiing refunds, shipping fees and taxes.
Updated on: 18/08/2024
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