Adam Hayes, Ph.D., CFA, is a financial writer with 15+ years Wall Street experience as a derivatives trader. Besides his extensive derivative trading expertise, Adam is an expert in economics and ...

For many businesses, inventory is the largest single investment of their total assets. Holding inventory can be costly for several reasons. The inventory itself is pricey. Consider the car dealership ...

The inventory turnover rate (ITR) is a key metric that measures how efficiently a company sells and replenishes its inventory over a specific period, typically a year. This ratio helps businesses ...

Days Inventory Outstanding (DIO) is a financial metric that measures how long, on average, a company takes to sell its inventory during a specific period. It’s a critical indicator of operational ...

A healthy inventory turnover ratio (ITR) shows you manage your inventory effectively. When products sell quickly, you free up cash to reinvest in your business growth. Smart inventory management also ...

Investopedia contributors come from a range of backgrounds, and over 25 years there have been thousands of expert writers and editors who have contributed. Investopedia / Michela Buttignol Annual ...

Ratios: Show the relationship between two quantities, like the teacher to student ratio in a class. Purpose in business: Ratios help analyse a company's performance, liquidity, and overall health. Big ...