Inventory Curve
Looking at inventory performance improvement through a different lens.
Tracking Financials
I track the financials of publicly traded companies in a number of industry groups on a routine basis to follow their inventory performance.
From the Income Statement, I capture:
- Sales
- Cost of Goods Sold
- Gross Profit
and from the Balance Sheet:
- Accounts Receivable
- Inventory
- Accounts Payable.
From this data, I calculate:
- inventory turnover
- GP%
- GMROI
- Cash to Cash cycle.
Here are graphs of this data for three companies in the same industry space. I leave you to do your own analysis and draw your own conclusions.
Note: Using the log scale:
- Allows large ranges of data to be shown on a single graph
- The slope of the line reflects percentage changes to allow easy comparison.
If you have questions or would like to discuss how this method can be used within your organization to improve performance, please feel contact me at David.Armstrong@inventorycurve.com.
