Data is the lifeblood of smart business decisions, and nowhere is this truer than in inventory. Robust inventory reporting transforms raw stock data into actionable insights. Ignoring this data means you are essentially flying blind, risking both stockouts and overstocking.
Here are 5 key inventory metrics every small business should track:
- Inventory Turnover Ratio: How quickly you sell your stock. A higher ratio is generally better.
- Days Sales of Inventory (DSI): The average number of days it takes to turn inventory into sales.
- Stockout Rate: The percentage of orders you couldn’t fulfill due to lack of stock.
- Gross Margin Return on Investment (GMROI): Measures the profit generated for every dollar invested in inventory.
- Fill Rate: The percentage of customer orders filled completely and immediately.
A powerful inventory system provides automated inventory reporting on these metrics, empowering you to optimize your purchasing and pricing strategies.
