AVERAGE INVENTORY PERIOD

CONDITION

Year : 2006
Your ratio : 22.66
Industry Avg : 9.02
Cost of Goods Sold : $424,970
Average Value Of Inventory : $26,380

GRAPH

AVERAGE INVENTORY PERIOD

INFORMATION

This ratio is another way to looking at the turnover ratio. Inventory remaining too long on shelf can be a symptom of pricing, out of date product or inadequate business promotion. Consider making the appropriate corrections.

DETAILS

This indicator demonstartes how quickly your inventory is moving from finished goods to sales by calculating the average length of your inventory period. Ideally, the average inventory period will be 20% higher than the industry average.

SUGGESTION

The perfomance of this ratio versus your peers indicates that you need to substantially increase your sales efforts. Some inventory may be aged and should be discounted to make room for more popular items.