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Cash on the Warehouse Floor: Is Your Warehouse Full of Productive Income Generating Assets... or Wasted Cash?

Richard E. Groover CPA

Inventory turnover is a Key Performance Indicator (KPI) on the radar of almost every manufacturer. Many small and mid-size companies use a turnover calculation based on the total average inventory on the

balance sheet and the total average cost of goods sold (CoGS) on the income statement. Calculating the ratio based on these numbers can be dangerous in a multi-product environment, leading management to

make what they mistakenly believe to be informed decisions, but which could actually have dire consequences for the profitability of the company.



  Cash on the Warehouse Floor: Is Your Warehouse Full of Productive Income Generating Assets... or Wasted Cash?