Inventory turnover ratios measure the number of times in a given period that a company’s average inventory is sold or used. By measuring how quickly goods move in and out of a company’s inventory, the inventory turnover ratio analysis can help business owners assess the efficiency and effectiveness of their inventory management system. The higher the turnover ratio, the better the inventory control and management system is considered to be. This helps a business identify if they need to adjust their inventory ordering and stocking policies to reach desired goals.