What is ITR in inventory ?

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Accepted Answer

ITR stands for Inventory Turnover Ratio, which measures how quickly a company sells and replaces its inventory.

ITR is a financial metric used to evaluate the efficiency of inventory management.
It is calculated by dividing the cost of goods sold by the average inventory value.
A high ITR indicates that a company is selling its inventory quickly and efficiently.
A low ITR may indicate that a company is holding too much inventory or is not selling its products effectively.
ITR can vary widely by industry and company size.
For example, a grocery store may have a higher ITR than a car manufacturer.
ITR can also be used to compare a company's performance to industry benchmarks or competitors.
A company can improve its ITR by implementing better inventory management practices, such as reducing lead times or optimizing order quantities.

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