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The American Heritage Dictionary of Business Terms » inventory turnover
inventory turnover
inventory turnover definition - business
inventory turnover
A measure indicating the number of times a firm sells and replaces its inventory during a given period, calculated by dividing the cost of goods sold by the average inventory level. A relatively low inventory turnover may be the result of ineffective inventory management (that is, carrying too large an inventory) or carrying out-of-date inventory to avoid writing off inventory losses against income. Also called stock turnover.
The American Heritage® Dictionary of Business Terms Copyright © 2009 by Houghton Mifflin Harcourt Publishing Company. Published by Houghton Mifflin Harcourt Publishing Company. All rights reserved.
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