This number will help you calculate your Cost of Goods Sold (COGS). Use the following steps to calculate your eCommerce business’s Amazon inventory turnover: Step 1: Determine your product inventory levelsĪ key part of your inventory turnover equation is determining your product inventory levels. Generally speaking, you should use a year-long period to calculate this ratio. Simply put, your Amazon inventory turnover ratio is the number of times your inventory is sold and replaced during a set period of time. Additionally, this ratio can inform your marketing decisions and determine what products you need to move. Your Amazon inventory turnover ratio can help you improve your restocking process and points to areas where you need to forecast better. This increases holding and warehouse costs while also preventing you from restocking high-demand items.
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