Stock Turn Ratio

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coultog

coultog

Free Member
Aug 5, 2006
279
7
Leeds, UK
  • #1
    Hello,

    I've spent some time looking at my stock turn ratio (the amount of days it takes me to sell my entire stock). Much to my unhappiness, I've found it's 140 days. Now, as a new business which is growing and developing I can understand the extended time because you don't start selling thousands of pounds worth of stock from day one.

    I was wondering from any established product based business what your stock turn ratio is? I would like mine to to be around 45 days to turnover my entire stock, however I am unsure how reasonable that would be.

    Thanks, G
     
    M

    Mister B

    Free Member
    Aug 31, 2007
    2,658
    639
  • #2
    As a rule of thumb, most retail business' would be happy with a turn of four which in effect means that your stock is turned every ninety days.

    The holy grail for all retailers is a turn of twelve, which means that by the time the invoice (assuming terms of thirty days) is due, the stock has been sold and the next thirty day cycle has begun.

    You also need to remember that the overall stock holding figure includes all stock, including obsolete seasonal.

    Must add that I have never seen this atually be achieved across a whole stock package.
     
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    coultog

    coultog

    Free Member
    Aug 5, 2006
    279
    7
    Leeds, UK
  • #3
    Thanks Mister B.

    By the sounds of it, at 140 days for a new business we're not doing so bad after all. On a quarterly basis we seem to turnover our current stock, so we may not be too far out.

    I would definitely like to clear my stock every thirty days - there's a target for me :)
     
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