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Low Inventory Turnover Ratio

oboloo Glossary

Low Inventory Turnover Ratio

A low inventory turnover ratio means that a company is taking longer than usual to sell its products or services. This could be an indication of poor inventory management, an inability to meet customer demand, or a lack of sales and marketing efforts. It may also be caused by a decrease in sales volume, which could be due to a range of factors such as seasonality, competition, or market saturation. Low inventory turnover can lead to cash flow issues and must be addressed quickly in order to maintain profitability. To increase turnover, companies need to focus on improving their sales and marketing techniques, reducing wastage, actively looking for ways to reduce costs, and investing in inventory management software.

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