Inventory turnover in turnover shows. Analysis of inventory turnover. Assortment of finished products

Inventories of goods provide supply and demand. The size of inventory depends on the volume and structure of the trade organization's turnover. To maintain the optimal proportion between the amount of turnover and the size of inventory, you need to analyze inventory turnover.

RETAIL TRADE TURNOVER

Retail turnover is an indicator of the performance of a trading enterprise, so it is important to constantly analyze it. The main tasks of analyzing retail turnover:

• checking the validity of the planned turnover;
• checking the implementation of the turnover plan for the reporting period (year, half-year, quarter, month), for individual components of the period;
• study of the dynamics of retail trade turnover (changes in its volume compared to the previous reporting period);
• consideration of the composition of trade turnover;
• studying the structure of retail turnover;
• factor analysis of turnover
• identifying reserves for increasing the volume of retail trade turnover.

Fulfillment of the retail turnover plan depends on many factors. Let us determine how factors associated with commodity stocks influence retail trade turnover. To do this, we will draw up a commodity balance. It shows the relationship between the balances of goods of a trading organization at the beginning and end of the period, the receipt of goods from suppliers, other disposals of goods and the amount of retail turnover.

Commodity balance (TB) can be represented as the following formula:

TB = O n + P = R + V + O k,

where O n is the balance of goods in the trading organization at the beginning of the year;

P—receipt of goods to the trading organization from suppliers for the year;

P - sales of goods for the year (retail turnover);

B - other disposal of goods (shortage, damage, scrap, damage and markdown of goods, sale to other trade organizations);

O k - the balance of goods in the trading organization at the end of the year.

The amount of retail turnover is influenced by factors related to labor resources:

• number of sales employees;
• labor productivity of sales workers.

Based on the data in table. 1, we determine how the value of retail turnover is affected by changes in the average number of sellers (quantitative factor) and the average annual output of one seller (qualitative factor). To calculate the influence of these factors, we use the difference method.

The increase in the volume of trade turnover compared to the plan takes place in the context of a decrease in the number of sellers, that is, solely due to an increase in their labor productivity.

Influence of factors:

• the change in the average number of sellers reduced retail turnover by 480 thousand rubles. (48 thousand rubles × 10 people);
• the change in the average annual output of one seller increased the amount of retail turnover by 960 thousand rubles. (4 thousand rubles × 240 people).

General influence of factors (balance of factors):

480 thousand rubles. + 960 thousand rub. = 1480 thousand rubles.

Factors related to the availability and use of fixed assets of trading organizations also influence the amount of retail turnover. It is important to study how the volume of trade turnover is affected by a change in the size of fixed assets of a trading organization, a change in capital productivity (we use the difference method).

The amount of retail trade turnover will increase if the material and technical base of trade is expanded.

WHOLESALE TRADE TURNOVER

A quantitative indicator of the activities of wholesale trade organizations is the volume of wholesale trade turnover. Wholesale trade turnover includes:

• sale of goods to retail trade organizations for subsequent sale to the public;
• release of goods to production organizations for processing.

Wholesale trade turnover is divided into warehouse and transit. This division depends on the ways in which goods are promoted.

Warehouse turnover involves the delivery of goods from production organizations to the bases and warehouses of wholesale organizations for part-time work, sub-sorting, selection of an assortment of goods and subsequent sale to retail trade organizations.

During transit trade, goods arrive from production organizations directly to retail trade organizations, bypassing intermediate links (wholesale trade organizations).

Transit turnover is divided into two types: with and without the participation of the wholesale organization in the calculations. During transit trade turnover with the participation of a wholesale organization, wholesale organizations carry out payment for goods according to payment documents from suppliers, as well as settlements with buyers of goods. The advantage of this type of trade turnover: it makes it easier for the supplier (production organization) to receive payments, since the supplier has settlement relationships not with numerous retail trading organizations, but with one wholesale trading organization.

During transit trade turnover without the participation of wholesale organizations in settlements, there are direct connections between production and retail trade organizations, both when shipping goods and when paying for shipped goods. Here, all payments are made directly between the supplier (shipper) and the recipient of the goods (buyer).

Advantages shipment of goods in transit:

• eliminates unnecessary commodity distribution links;
• accelerates the turnover of goods;
• reduces distribution costs.

In these conditions, it is important to ensure proper control over the range, completeness and quality of shipped goods. Transit trade turnover is most common for goods of a simple range.

Having studied the wholesale trade turnover, you should consider the reasons for the identified deviations from the plan and outline ways to eliminate the negative aspects that exist in the activities of the wholesale organization.

PRODUCT ANALYSIS

If a product sells too slowly, we say the product turnover is low. If the turnover is very high, it means that the product is selling too quickly. Then the buyer runs the risk of not finding the product he wanted to buy from us. This means that you need to correctly analyze and plan inventory turnover. Inventories are analyzed, planned and taken into account in absolute and relative terms.

To calculate turnover, three parameters are needed:

• average inventory for the period (number of goods in stock, for example, per month);
• duration of the billing period (week, month, year). For perishable goods (bread, milk) the period can be equal to a week. The annual turnover can be calculated by the owner, who evaluates the performance of the company as a whole. For tactical inventory management, it is worth using a month;
• turnover for the billing period, that is, sales per month (week, year). You should calculate the stock and sales of the same product (you cannot take all the stocks of the “alcohol” group and compare them with sales of the “vodka” category).

When assessing inventory turnover, important to remember:

• We count turnover only where there are inventories. No inventory - no turnover. For example, a hairdresser sells services - haircut, styling, manicure. There is no stock on hand for these services;
• We take into account only those goods that are physically present in the warehouse and recorded. A product is not considered when it is in stock but not received; purchased, but still on the way; sold but not shipped to the client;
• We calculate turnover in quantitative or monetary terms. Inventory and turnover must be calculated in the same quantities. All calculations of turnover must be carried out in purchase prices. Trade turnover is calculated not at the selling price, but at the price of the purchased goods;
• turnover is needed in dynamics. Let's assume we have a turnover of 30 days. Is it good or bad? If it was 15 days and became 30, this is a negative trend. If the turnover was 60 days, but became 30, then everything is fine, you can work in the same direction.

Using the words “turnover” and “turnover ratio” in the future, we will mean the same thing. This is the number of turnover in times or days of the average inventory balance for a specific reporting period.

Let's present the calculation formula average inventory(TK Wed):

TZ av = (TZ 1 / 2 + TZ 2 + TZ 3 + TZ 4 + … + TZ n / 2) / (n - 1),

where TZ 1, TZ 2, …, TZ n— inventories of goods for individual dates of the analyzed period;

n— number of dates in the period.

An example of calculating the average annual reserve using the presented formula is given in table. 2.

Let's look at how turnover is calculated in days and times.

Calculation formula turnover in days(About the day):

About days = Average inventory for the period × Number of days / Turnover for the period.

Turnover in days shows how many days it takes to sell the average inventory.

EXAMPLE 1

The average stock of “Malysh” washing powder for the month was 155 pcs., powder sales for this period were 325 pcs.

Let's determine the turnover of this product in days:

155 pcs. × 31 days / 325 pcs. = 14.78, or 15 days.

Thus, it takes 15 days to sell the average supply of Baby powder.

At this stage, it is too early to draw conclusions, since you need to look at turnover over time. If, for example, last month the turnover was 10 days, but it became 15, then this is a signal that it is necessary to reduce the quantity of imported goods or increase sales (you can do both at the same time). If the turnover rate was 20, but became 15, it means that the goods began to turn over faster, and this is good.

Calculation formula turnover in times (Image):

Volume = Turnover for the period / Average inventory for the period.

Turnover in times indicates how many times during the period the product was turned over, that is, it was sold.

EXAMPLE 2

The average stock of “Malysh” washing powder for the month was 155 units, sales were 325 units.

Let's calculate the powder turnover in times:

325 pcs. / 155 pcs. = 2 times a month.

The supply of “Baby” powder will be fully sold twice a month.

Twice a month is the same as 15 days of turnover, so there is no fundamental difference in the calculation method. In our opinion, calculating turnover in days is more convenient, so we will continue to talk about turnover in days.

TURNOVER, INVENTORY LEVEL AND QUALITY RATE

Let's consider indicators that have little to do with turnover, but are used in practice.

Product inventory level(At the technical level). This indicator characterizes the store's supply of inventory on a certain date. It shows how many days of trading (given the current turnover) the stock in the store will last.

In terms of reference = Inventory at the end of the analyzed period × Number of days / Turnover for the period.

EXAMPLE 3

On July 15, there were 243 units left in the warehouse. “Baby” powder. For two weeks of July (from the 1st to the 15th), sales amounted to 430 units.

Let's determine the stock level of this powder:

TK = 243 pcs. × 15 days / 430 pcs. = 8.4 days

The stocks of “Malysh” powder that are in the store’s warehouse will last for 8.4 days. This means that after 8 days it is necessary to replenish the stock.

Leaving. This indicator should not be confused with turnover. Turnover shows how many revolutions a product makes during a period, departure rate shows how many days it will take something to leave the warehouse. If, when making calculations, we do not operate with the average stock, but calculate the turnover of one batch, then we are talking about turnover.

EXAMPLE 4

On March 1, a batch of 1000 pencils arrived at the warehouse. On March 31st there were no pencils left in stock (0). Sales amounted to 1000 units.

The supply of pencils turns over once a month, like the turnover rate is 1. However, you need to understand that in this case we are talking about one batch and the time of its implementation. One batch doesn’t turn around in a month, it goes away.

To calculate inventory turnover, batch accounting is not needed.

In some works, yield refers to the return per square meter of retail space. This is also an important indicator, which is calculated using the following formula:

Attrition rate = Monthly turnover / Occupied space in the sales area.

EXAMPLE 5

We use the data from the table. 3 and compare the indicators within the “washing powder” category.

As can be seen from the data in table. 3, “Max” powder has the best sales per 1 m2, despite poor turnover (27 days). It can be concluded that too large a quantity of goods was purchased. By reducing inventory, we will level out turnover.

Malysh powder has a good turnover, but sales per 1 m2 are the worst. This means that the shelf space is being used ineffectively or the product is located in the “cold” area of ​​the sales floor. It is necessary to increase sales in general or reduce the occupied space.

Ariel powder, although turnover is not very good, shows acceptable yield. Here we can also talk about a decrease in stock.

Inventory levels and turnover (return per square meter) need to be calculated, but they have little connection with turnover itself.

NOTE

There is no uniform terminology in what we call performance indicators of a trading enterprise. Therefore, be sure to check with your colleagues or partners what exactly they mean by this or that term.

TURNOVER RATE

Very often you can hear the question: “What are the turnover rates and how to determine them?”

Companies always use the concept of “turnover rate,” and each company has its own. Turnover rate- this is the number of days or turns in which, in the opinion of management, the stock of goods must be sold in order for the trade to be considered successful.

Each industry and each region has its own standards, each supplier, each type or category of goods has its own standards. Much depends on logistics, purchase volumes and delivery times, supplier reliability, market growth and demand for the product. If all suppliers are local and turnover is high, then the coefficients can reach 30-40 turnovers per year. If deliveries are intermittent, the supplier is unreliable, demand fluctuates, then for a similar product in a distant region of Russia the turnover will be 10-12 turnovers per year. This is fine.

Turnover rates will be higher for small enterprises working for the end consumer, and much lower for enterprises that produce group A products (means of production). The reason is the length of the production cycle.

There is a danger of crude adherence to standards. For example, you do not meet the turnover standard and begin to reduce your safety stock. As a result, there are gaps in the warehouse, there is a shortage of goods and unsatisfied demand. You begin to reduce the size of the order - the costs of ordering, transporting and processing goods increase. Turnover increases, but availability problems remain.

The norm is a general indicator. You should react and take action as soon as some negative trend is detected: for example, inventory growth is outpacing sales growth, and simultaneously with sales growth, inventory turnover has decreased. Then you need to evaluate all products within the category (perhaps some individual items are purchased in excess) and take weighted solutions:

• look for new suppliers capable of providing shorter delivery times;
• stimulate product sales;
• give him priority place in the hall;
• train sellers to advise buyers on this product;
• replace the product with a more well-known brand, etc.

EXAMPLE 6

A store selling stationery and toys on Sakhalin has an average turnover of 90 days. This is good. For such a store in Moscow, this figure seems unacceptable. The fact is that it takes a very long time to deliver goods to Sakhalin, and the company is forced to have significant reserves to maintain turnover. This is the price of business. But the trade margin in Sakhalin, where there are practically no competitors, is at least 150%, which for Moscow seems like a pipe dream.

The higher the turnover, the less goods are in the warehouse, the faster they turn into money. If the turnover is too high (for example, close to 1-2 days), this indicates that the store is operating with virtually no safety stock; goods must be delivered daily. If there is the slightest disruption in supplies or an increase in demand for goods, we risk being left without goods. A shortage is dangerous for a retail enterprise not only due to lost profits, but also because the existing demand for the product will be met by a competitor.

It should be taken into account that daily deliveries present logistical challenges. Acceptance, counting, and posting of goods are fraught with the possibility of errors and losses. The more often these operations are performed, the more errors there are.

In the case of perishable goods (bread, milk), this situation cannot be avoided. For other goods, it is wiser not to reduce turnover to one or two days, but to work out for yourself an optimal period that minimizes risks and losses. This will be the turnover rate for a particular product.

The norm for one product will not be the norm for another! Don't try to find a single standard for batteries and plasma TVs. These products have nothing in common. If you compare products by turnover, then this can only be done among products of the same category. There is no need to compare bread with cookies, beer with vodka. You can compare cookies from different factories.

ANALYSIS OF TURNOVER MEASUREMENT RESULTS

When comparing products, you can build a “Turnover - Margin” matrix. Such a matrix will allow you to understand which products bring more profit over the same period, and which bring less.

EXAMPLE 7

Table 4 presents data for one product category. Let's find out which products in the category are most interesting to us.

From the data in table. 4 follows: although product No. 5 has an average trade margin, it has the best turnover. It brings the highest profit per month per unit of production. Product No. 1 has a high margin, but shows the worst turnover. Consequently, the monthly profit per unit of production is minimal.

What can be done? It is necessary to find out what is causing such poor turnover - excess inventory or poor sales? If the problem is in sales, you need to stimulate turnover. If the problem is excess inventory, there is no need to import goods in huge quantities.

We have to put up with the fact that we have poor turnover for some goods. This is not a buyer or sales mistake, but conditions that cannot be adjusted. Typically this situation is related to delivery conditions. For example, a supplier goes on vacation or closes a plant for maintenance for two months. To provide a company with supplies, it is necessary to purchase a two- or three-month supply. Another example: the delivery of goods takes so long (for example, from China) that to ensure uninterrupted supply it is necessary to purchase goods in large quantities. You need to understand that this is the price of business. In this case, try to compensate for your costs of maintaining inventory with loans from suppliers.

1. The financial success of a company directly depends on how quickly funds invested in inventories are converted into hard cash.
2. Inventory turnover does not have approved or generally accepted standard indicators. The most optimal figures can be determined as a result of analysis within one industry.

For a company selling products, it is very important to be able to manage inventory in order to make a profit from its activities. Calculating the inventory turnover period allows you to understand how well the company is doing in terms of inventory. With this information, you can compare your company's inventory turnover period with that of your competitors. A shorter inventory turnover period will indicate higher inventory turnover and better return on assets. Calculating the inventory turnover period requires knowledge of the cost of goods sold for the period and the average cost of inventory for this period. To calculate the inventory turnover period in days, you will first need to calculate the inventory turnover ratio, for which you will need the above-mentioned cost price and the average cost of the company's inventory.

Steps

Part 1

Become familiar with the concept of inventory turnover ratio. Inventory turnover tells us how many times a company uses and replenishes its inventory in a given period of time. A low turnover ratio suggests that the company's assets are being used inefficiently and are generating low profits. In this situation, the company holds too much inventory because it cannot use it quickly enough. A high turnover ratio may be an indication that a company is missing out on additional sales opportunities when a customer wants to purchase a product, but the company does not have enough inventory to produce and sell it.

Determine the cost of goods sold. Cost of goods sold represents the direct costs incurred in producing products or providing services. In the service sector, cost includes personnel costs, including wages, bonuses, and taxes. In retail or wholesale trade, cost includes the cost of purchasing goods from the manufacturer, as well as expenses incurred in connection with the acquisition of goods, their storage and display on store shelves.

• Cost of sales is reflected in the income statement. It is the value that is subtracted from revenue to give gross profit.
• In a trading company, the cost of sales can be simplified as follows: Cost of sales = Cost of inventory at the beginning of the period + Purchase of inventory during the period - Cost of inventory at the end of the period
• For example, consider a period of 12 months, at the beginning of which the company had inventories of 9,000,000 rubles, during the period goods were purchased for 20,000,000 rubles, and at the end of the period inventories amounted to 3,000,000 rubles.
• A simplified cost calculation would look like this: 9,000,000 + 20,000,000 - 3,000,000 = 26,000,000 (rubles).
• The resulting value of 26,000,000 rubles will be indicated in the financial results report under the cost of sales line.

1. Determine the average cost of the company's inventory for the period. The average value of inventory for the reporting period is determined using the simple average calculation formula. The value of a company's inventory may vary significantly during an accounting period. That is why, to calculate financial indicators of turnover, it makes sense to use its average value. The average value avoids inaccuracies due to sudden changes in inventory levels.

   • Average inventory value for the period: (Inventory at the beginning of the period + Inventory at the end of the period) / 2.
   • For example, in the reporting year, the company had reserves in the amount of 9,000,000 rubles at the beginning of the year, and 3,000,000 rubles at the end of the year.
   • The average value of inventory for the year is as follows: (9,000,000 + 3,000,000 / 2 = 6,000,000 (rubles).

2. Use the formula for calculating the inventory turnover ratio. Knowing the cost of sales and the average cost of inventory for the period, you can calculate the inventory turnover ratio. From the above examples, it is clear that for the period of 12 months under review, the cost of sales was 26,000,000 rubles, and the average cost of inventory was 6,000,000 rubles. To calculate the inventory turnover ratio, it will be necessary to divide the cost by the average cost of inventory.

   • 26 000 000 / 6 000 000 = 4,33
   • That is, this company uses and replenishes its reserves 4.33 times per year.

3. Use the formula for calculating the inventory turnover period. The inventory turnover period is determined by dividing the number of days in the analyzed period by the inventory turnover ratio for this period. In the above example, the turnover ratio was 4.33. Since in the example under consideration a period of 12 months was used, the total number of days in the period will be 365.

   • The inventory turnover period will be calculated as follows: 365 / 4.33 = 84.2 (days).
   • This suggests that it takes the company 84.2 days to fully sell its average inventory.

4. Apply an alternative calculation formula. If you have not previously calculated the inventory turnover ratio, you can directly use the values ​​of cost of sales and average inventory value to calculate the inventory turnover period. You will need to divide the average cost of inventory by the cost of sales for the period. Then the resulting number must be multiplied by the number of days in the analyzed period.

   • In the above examples, the average cost of inventory is 6,000,000 rubles, the cost of sales is 26,000,000 rubles, and the analyzed period is 365 days.
   • The calculation of the inventory turnover period will look like this: (6 000 000 / 26 000 000) * 365 = 84,2
   • The same value is obtained. It takes the company 84.2 days to fully sell its average inventory.

Part 3

1. Study the cash circulation cycle. The cash cycle reflects the number of days it takes a company to convert its resources into cash flows. The inventory turnover period is one of the three components of this indicator. The second component is the receivables turnover period, or the number of days it takes a company to collect receivables. The third component is the accounts payable turnaround period, or the number of days it takes a company to pay off its accounts payable.

Inventory turnover (inventory turnover) shows how many times during the period under review the company used the available average inventory balance. The indicator characterizes the quality of the enterprise's reserves, the efficiency of their management, and allows us to identify the remains of unused, obsolete or substandard reserves. The importance of the indicator is due to the fact that profit arises with each “turnover” of inventories (i.e., use in production, operating cycle).

In most theoretical sources inventory turnover ratio is calculated as the ratio of the cost of production to the average value of inventories, work in progress and finished goods in the warehouse for the period (inventory turnover at cost - Oz):

Oz = C / ((Znp + Zkp) / 2)

Where,
C is the cost of products produced in the billing period;
Znp, Zkp - the amount of inventory balances, work in progress and finished goods in the warehouse at the beginning and end of the period.

The total cost of goods sold during a given period, usually a year (it is preferable to take cost of goods sold rather than sales volume, since the latter includes gross profit, which tends to inflate the turnover ratio), divided by the average inventory over the period the same period, gives a number showing how many times the product has been turned around.

The reverse indicator is more visual and convenient for analysis - the inventory circulation period in days (Pos). It is calculated by the formula:

Pos = Tper / Oz

where, Tper is the duration of the period in days.

The higher the inventory turnover, the more efficient its activities are, the less the need for working capital and the more stable the financial position of the enterprise, all other things being equal.

The calculated turnover periods for specific components of current assets and current liabilities have a real economic interpretation.

For example, an inventory turnover period of thirty days means that, given the current production volume in a given period of analysis, the enterprise has created inventories for 30 days.

Take into account several types of inventory turnover:

• turnover of each product item in quantitative terms (by pieces, by volume, by weight, etc.);
• turnover of each item of goods by value;
• turnover of a set of items or the entire inventory in quantitative terms;
• turnover of a set of items or the entire inventory by value.

Assessing turnover is the most important element of analyzing the efficiency with which an enterprise manages inventories. The acceleration of turnover is accompanied by additional involvement of funds into turnover, and the slowdown is accompanied by the diversion of funds from economic turnover, their relatively longer necrosis in inventories (otherwise - immobilization of own working capital). In addition, it is obvious that the company incurs additional costs for storing inventory, associated not only with warehouse costs, but also with the risk of damage and obsolescence of the goods.

As a result, when managing inventories, stale and slow-moving goods, which represent one of the main elements of immobilized (i.e., excluded from active economic circulation) working capital, must be subject to special control and audit.

IN Western banking practice Analysts usually use an alternative formula - the ratio of inventories to revenues multiplied by 365 days. The formula looks like:

Oz = (Inventory volume / Net revenue) x 365

The amount of inventory is taken at the end of the period, as it is usually assessed over time. The amount of inventory is correlated not with cost, but with revenue as one of the most important factors for credit analysis (this ensures a unified approach to companies that sell goods and services, because for the latter, most of the expenses are not at cost, but on general commercial and Administrative expenses). Many believe that correlation with cost gives a more accurate result, since there is a trading margin in revenue, which artificially increases turnover, but, on the other hand, this maintains the uniformity of the approach (for example, asset turnover is revenue divided by the amount of assets), In addition, this method is convenient when calculating the operating cycle.

In principle, it is possible that at the beginning of the period and at the end of the period, inventories are equal to zero. Then the turnover rate can be calculated by taking the average amount of inventory in the period (of course, if you have access to this data).

Previously, it was certainly believed that accelerating warehouse turnover was a good thing. Inventory turnover characterizes the mobility of funds that an enterprise invests in creating inventories: the faster the funds invested in inventories are returned to the enterprise in the form of proceeds from the sale of finished products, the higher the business activity of the organization. What does a more careful consideration of the processes occurring in the warehouse give us? Turnover in itself does not mean anything - you need to monitor the dynamics of changes in the ratio, taking into account the following factors:

1. the coefficient decreases - the warehouse is overstocked;
2. the coefficient is growing or very high (shelf life is less than one day) - working “on wheels”, which leads to failures in the shipment of goods to customers.

In conditions of constant shortage, the average amount of warehouse stock can be equal to zero: for example, if demand is growing all the time, and the company does not have time to deliver goods. As a result, there are gaps in the warehouse, shortages of goods and unsatisfied demand. If the order size decreases, the costs of ordering, transporting and processing goods increase. Turnover increases, but availability problems remain. There are options for justifiably increasing warehouse stocks - during periods of high inflation or expectations of sharp changes in exchange rates, as well as in anticipation of seasonal peaks in purchasing activity.

If a company is forced to store in a warehouse goods of irregular demand, goods with a pronounced seasonality, then achieving high turnover is not an easy task. To ensure customer satisfaction, the company will be forced to stock a wide range of hard-to-find items, which will slow down overall inventory turnover. It is also possible that the supplier provides a good discount (for example, 5-10%) for a significant volume plus a significant deferred payment (in a crisis it is difficult to refuse such an offer).

Also, for a store, the terms of delivery of goods play an important role: if the purchase of goods is made using its own funds, then turnover is very important and indicative. If on credit, then own funds are invested to a lesser extent or not invested at all - then low turnover of goods is not critical, the main thing is that the loan repayment period does not exceed the turnover rate. If the goods are taken mainly on terms of sale, then first of all it is necessary to proceed from the volume of warehouse space and turnover for such a store is the last most important indicator.

In fact, it is useful to remember more often that numbers alone do not tell you anything about the effectiveness of inventory management. For example, in retail trade, bread and expensive cognac have completely different indicators - the turnover of bread is several times higher than that of cognac. Obviously, bread has one “task” in the store, and cognac has a completely different one, and perhaps the store earns more from one bottle of cognac than from bread sales in a week.

Money is the only and universal meter, and not kilograms, pieces, cubic meters, etc. Companies invest some amount of money in a product and want to get the maximum return on it (return on investment).

Unit of measurement:

Explanation of the essence of the indicator of the period of one inventory turnover

The period of one inventory turnover (English equivalent – ​​Days’ Sales in Inventory, Inventory Turnover in Days) is an indicator of business activity that indicates the efficiency of the company’s inventory management. The coefficient is calculated as the ratio of the product of the number of days in a year by the average annual amount of inventory to the amount of cost. The value of the indicator indicates how many days inventory is stored in the company's warehouse.

Standard value of the period of one inventory turnover:

The decrease in value during the study period is a positive trend. It indicates that less funds are diverted to stockpiling. To determine the company’s performance in this area, it is advisable to compare the indicator with the values ​​of competitors.

The financial institution offers the following regulatory indicators depending on the company’s field of activity:

Table 1. Standard value of the indicator by field of activity, days

Source: Vasina N.V. Modeling the financial condition of agricultural organizations when assessing their creditworthiness: Monograph. Omsk: Publishing House NOU VPO OmGA, 2012. p. 49.

In general, the rule applies - the lower the period of one inventory turnover, the more effective the control over the process of formation and use of inventories.

It is worth remembering that the indicator value may be too low. In this case, the production or sales process may be paralyzed. Therefore, the inventory management policy should take into account seasonal fluctuations, changing customer tastes, industry and production process characteristics, possible unforeseen situations during delivery, and other factors.

Directions for solving the problem of finding an indicator outside the standard limits

If the indicator value deviates from the standard value, it is necessary to optimize the inventory structure. To do this, you can use methods such as ABC analysis, XYZ analysis and others. Reducing the volume of inventories will reduce the amount of necessary financial resources, which will reduce financial costs or increase the company's income by investing money in intensifying activities.

Formula for calculating the period of one inventory turnover:

Period of one inventory turnover = (360*Average annual inventory) / Cost (1)

Period of one inventory turnover = 360 / Inventory turnover (2)

Average annual inventory (most correct method) = Sum of inventory at the end of each working day / Number of working days (3)

Average annual inventory (if only weekly data is available) = Sum of inventory at the end of each week / 51 (4)

Average annual inventory (if only monthly data is available) = Sum of inventory at the end of each month / 12 (5)

Average annual inventory (if only quarterly data is available) = Sum of inventory at the end of each quarter / 4 (6)

Average annual inventory (if only annual data is available) = (Beginning of year inventory + End of year inventory) / 2 (7)

Monthly, weekly and daily inventory estimates are available for internal analysis, but not for external analysis. Quarterly figures may be available for external analysis.

Notes and corrections:

1. During the year, the value of the indicator may fluctuate (for example, due to seasonal factors). At the end of the period, the company's business activity decreases, the volume of inventories, work in progress and finished goods inventory will be lower, so the period of one inventory turnover may be overestimated. If a company prepares its financial statements at the peak of its business activity, inventory turnover may be overestimated and the period of one inventory turnover may be underestimated. To determine the exact value of the indicator, you must use one of the formulas 3-6.

An example of calculating the period of one inventory turnover:

Company OJSC "Web-Innovation-plus"

Unit of measurement: thousand rubles.

Period of one inventory turnover (2016) = (360*(87/2+88/2))/405 = 77.78 days

Period of one inventory turnover (2015) = (360*(88/2+75/2))/487 = 60.25 days

The efficiency of inventory management is decreasing at OJSC Web-Innovation-plus. This is evidenced by a significant increase in the period of one inventory turnover - from 60.25 days in 2015 to 77.78 days in 2016. The reason for this trend is a decrease in production and sales volumes, while inventory formation standards remained at the previous level. It is necessary to review them and work towards increasing inventory turnover and reducing the period of one inventory turnover.

The turnover of industrial inventories characterizes the speed of movement of material assets and their replenishment. The faster the turnover of capital placed in inventories, the less capital is required for a given volume of business operations,

Inventory turnover varies greatly across industries. In industries with long operating cycles, inventory formation requires larger capital.

The turnover time of inventories of enterprises in the same industry, as a rule, characterizes how successfully they use capital. As was found out earlier, the accumulation of inventories is associated with a very significant additional outflow of funds, which makes it necessary to assess the possibility and feasibility of reducing the shelf life of material assets.

The level of inventories is determined by the volume of sales, the nature of production, the nature of inventories (the possibility of storing them), the possibility of supply interruptions and the cost of acquiring inventories (possible savings from purchasing larger volumes), etc.

The level of work in progress depends on the nature of production, industry characteristics, and the method of assessment.

The main factor to consider when analyzing finished goods inventory levels is the sales forecast. In turn, forecasting sales volume requires correct anticipation of customer needs. Therefore, one of the advantages of long-term economic ties is the ability to coordinate production with the purchasing plans of buyers.

The assessment of inventory turnover is carried out for each type of inventory (inventory, finished goods, goods, etc.). As noted earlier, to estimate the rate of inventory turnover in a simplified way (according to reporting data), the formula is used

Wherein:

A more accurate calculation of average inventory volume is based on data on monthly material balances. The shelf life of inventories is determined by the formula

D To more accurately calculate the duration of inventory storage, formulas are used

An analysis of the state and dynamics of inventory turnover at the enterprise is presented in table. 34

Table 34

Assessment of inventory turnover status

* The indicators are taken from a similar table compiled based on the results of the past year.

Table data 34 confirm earlier conclusions regarding the general slowdown in the turnover of current assets. This is clearly seen in the example of inventory turnover, the shelf life of which at the enterprise increased by 5.5 days compared to last year, which indicates the accumulation of inventories at the enterprise.

This situation is becoming increasingly common in the context of economic disruption and inflation. The fall in the purchasing power of money forces enterprises to invest temporarily available funds in inventories of materials. In addition, the accumulation of inventories is often a necessary measure to reduce the risk of non-delivery (short delivery) of raw materials and materials necessary for the production process of the enterprise. Let us note in this regard that an enterprise that focuses on one main supplier is in a more vulnerable position than enterprises that base their activities on contracts with several suppliers.

At the same time, it should be borne in mind that the policy of accumulating inventory inventories inevitably leads to an additional outflow of funds due to:

increase in costs arising in connection with the ownership of inventories (rent of warehouse premises and their maintenance, costs of moving inventories, property insurance, etc.);

increasing costs associated with the risk of losses due to obsolescence and damage, as well as theft and uncontrolled use of inventory items (it is well known: the greater the volume and shelf life of property, the more difficult it is to control its safety);

increasing the amount of taxes paid. In conditions of inflation, the actual cost of consumed inventories (the amount they are written off to cost) is significantly lower than their current market value. As a result, the amount of profit turns out to be “inflated”, but it is from it that the tax due will be calculated. The picture is similar with value added tax. The fact that as the volume of reserves increases, the amount of property tax increases probably does not require explanation;

diversion of funds from circulation, their “death.” Excessive inventories stop the movement of capital, disrupt the financial stability of activities, forcing the management of the enterprise to urgently find the funds necessary for current activities (usually expensive). Therefore, it is not without reason that excessive inventories of inventory items are called the “graveyard of business.”

These and other negative consequences of the stockpiling policy often completely cover the positive effect of savings due to earlier purchases.

A significant cash outflow associated with the costs of creating and storing inventories makes it necessary to find ways to reduce them. In this case, of course, we are not talking about reducing the cost of creating and maintaining inventory inventories to a minimum. Such a solution would most likely be ineffective and would lead to an increase in other types of losses (for example, from damage and uncontrolled use of inventory items). The challenge is to find the “golden mean” between excessively large inventories, which can cause financial difficulties (lack of cash), and excessively small inventories, which are dangerous for the stability of production. Such a task cannot be solved in conditions of spontaneous formation of reserves - an established system for monitoring and analyzing the state of reserves is necessary.

In the theory and practice of inventory management, the following main signs of an unsatisfactory resource control system are distinguished:

a tendency towards a constant increase in the duration of inventory storage;

continuous growth of inventories, noticeably outstripping the dynamics of increase in the volume of products sold;

frequent equipment downtime due to lack of materials;

lack of storage space;

periodic refusal of urgent orders due to insufficient (lack of) inventories;

large amounts of write-offs due to the presence of obsolete (stale) slow-turning inventories;

significant volumes of write-offs of inventories due to their damage and theft.

The main objectives of monitoring and analyzing the status of inventories:

ensuring and maintaining liquidity and current solvency;

reducing production costs by reducing the cost of creating and storing inventories;

reduction of lost working time and equipment downtime due to lack of raw materials;

prevention of damage, theft and uncontrolled use of material assets.

Achieving the set goals involves performing the following accounting and analytical work.

1. Assessing the rationality of the inventory structure, allowing to identify resources whose volume is clearly excessive, and resources whose acquisition needs to be accelerated. This will avoid unnecessary capital investment in materials for which demand is declining or cannot be determined. It is equally important, when assessing the rationality of the inventory structure, to establish the volume and composition of spoiled and unusable materials. This ensures that inventories are maintained in the most liquid condition and the funds immobilized in inventories are reduced.

2. Determining the timing and volume of purchases of material assets. This is one of the most important and difficult tasks for analyzing the state of inventories for modern operating conditions of Russian enterprises.

Despite the ambiguity of the decisions made for each specific enterprise, there is a common approach to determining the volume of purchases that allows taking into account:

the average volume of material consumption during the operating cycle (usually determined based on the results of an analysis of the consumption of material resources in past periods and the volume of production under the conditions of expected sales);

additional quantity (safety stock) of resources to compensate for unforeseen costs of materials (for example, in the case of an urgent order) or to increase the period required to form the necessary reserves.

3. Selective regulation of inventories. suggesting that attention should be focused on expensive materials or materials that have high consumer appeal. In foreign practice, the so-called ABC method has become widespread, the techniques of which can also be applied at Russian enterprises. The main idea of ​​the ABC method is to evaluate each type of material in terms of its value. Meaning; the degree of use of the material for a specific period; the time required to replenish stocks of this material, and the costs (losses) associated with its absence from stock; the possibility of replacement, as well as losses from replacement.

A small share (usually up to 20%) of these material resources in the total volume of material assets stored in the warehouse determines the main amount of cash outflow during the formation of inventories (about 80%) . Such materials are considered as resources of group A. Materials of group B are considered secondary; they are less expensive than group A materials, but exceed them in the number of items. Group C materials are considered relatively unimportant - these are the least expensive and most abundant material assets. Their acquisition and maintenance are accompanied by an insignificant (in comparison with the total amount) outflow of funds. Typically, the costs of storing such inventories are less than the costs of ensuring strict control over ordered batches, safety (reserve) stocks and warehouse balances.

Material resources are divided into the listed groups depending on the specific production conditions. The main thing here is that materials of group A are most carefully controlled. Particular attention is paid to: calculating the need for them; calendar planning for the formation of reserves and their use; justification of the amount of safety reserves; inventory.

Another useful method for monitoring the state of inventories of material assets in modern conditions of mass thefts can be their division into “sticky” ones, i.e. scarce or expensive (for example, precious metals, alcohol, narcotic drugs), to which special storage conditions and additional methods of controlling their movement are applied, and “non-sticky”, for which storage in bulk, unauthorized use and “boiler” accounting are allowed.

4. Calculation of turnover indicators of the main groups of inventories and their comparison with similar indicators of past periods in order to establish the correspondence of the availability of inventories to the current needs of the enterprise. To do this, calculate the turnover of materials accounted for in various sub-accounts (“Raw materials and materials”, “Purchased semi-finished products and components, structures and parts”, “Fuel”, “Containers and packaging materials”, “Spare parts”, etc.). and then the total turnover of materials by determining the weighted average.

Calculation of turnover by types of material assets is presented in table. 35.

Table 35

Analysis of asset turnover

The weighted average value of the storage period of material assets is:

As you can see, other materials have the longest shelf life (about 120 days). At the same time, we must assume that the main opportunities for reducing the outflow of funds in connection with the creation of inventories do not lie here. Considering that the specific gravity of the material is less than 3% of the cost of materials consumed, it can be assumed that it will be classified as group C.

As already noted, it is necessary to subject a detailed analysis to the state and movement of material assets, the creation of reserves of which causes the main outflow of funds, i.e., resources of group A. It is quite possible that in the analyzed enterprise this group will include resources accounted for under the item “Raw materials” and materials." The feasibility of creating stocks of raw materials and materials corresponding to the volume of their 2-month consumption (54.4 days) must be assessed based on the specific conditions of the enterprise.

When analyzing working capital turnover, you need to pay attention to the following:

the duration of the enterprise's operating cycle and its components;

the main reasons for changes in the duration of the operating cycle;

the ratio of the duration of the operating cycle and the period of repayment of accounts payable;

reasons for discrepancies in financial results and changes in cash flows;

main factors of cash outflow;

receivables turnover rate;

validity of the existing shelf life of inventory items.