Stock cover is 14 weeks. Nine SKUs are 80% of sales.

Aggregate stock turns can look respectable while most of the cash sits in lines that barely move, and the usual fix makes it worse.

By Steve 5 min read
Abstract bridge artwork for Stock cover is 14 weeks. Nine SKUs are 80% of sales.

A business with a drawn overdraft and a full warehouse is rarely holding too much stock. It is usually holding the wrong stock, in a pattern that the headline numbers are designed to conceal. Stock turns, weeks of cover, inventory as a percentage of sales: all of these are averages taken across a population that is wildly unequal. They tell you almost nothing about where the cash is trapped or how to release it. Two distributors can report identical stock turns. In the first, the cash sits in fast-moving lines…

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Important: General information only. Rialto Bridge articles describe patterns and considerations that may apply to a business; they are not financial, legal, tax or accounting advice, and they take no account of your particular circumstances. Consider your own situation and seek advice from a qualified professional before acting.

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