Why is Inventory Turnover Important for Entrepreneurs?
For entrepreneurs, understanding and optimizing inventory turnover is crucial for several reasons:
Cash Flow Management: Efficient inventory turnover improves cash flow, as it reduces the amount of money tied up in unsold goods. Customer Satisfaction: High turnover ensures that products are fresh and up-to-date, contributing to better customer satisfaction. Storage Costs: Lower inventory levels reduce storage costs, freeing up capital for other business activities. Competitive Advantage: Efficient inventory management can be a significant competitive advantage in industries where quick response to market demand is essential.