INVENTORY TURNOVER RATIO AS A SUPPLY （存货周转率是一个供应）.pdf

S e r b i a n Serbian Journal of Management 4 (1) (2009) 41- 50 J o u r n a l o f M a n a g e m e n t INVENTORY TURNOVER RATIO AS A SUPPLY CHAIN PERFORMANCE MEASURE C. Madhusudhana Raoa* and K. Prahlada Raob aDepartment of Mechanical Engineering, Siddharth Institute of Engineering Technology, Puttur – 517583, Andhra Pradesh, India bDepartment of Mechanical Engineering, JNTU College of Engineering, Anantapur – 515004, Andhra Pradesh, India (Received 14 March 2009; accepted 27 April 2009) Abstract Inventory management is vital in supply chain performance of a firm. The inventory turnover ratio measures the number of times a company sells its inventory during the year. A high inventory turnover ratio indicated how best the firm is operating economically in selling its products. Inventory turnover is a measure of managements ability to use resources effectively and efficiently. Precise control and safeguarding of inventory is an essential task for a successful and well organized company. Business requires timely and accurate information on inventory location, movement and valuation. ERP systems provide data pertaining to receipt of goods, movement within and between locations, the sale, removal or disposition of goods, lot and serial tracking, precise valuation and status of goods remaining in inventory at any point of time. As a part of its continuous improvement program (CIP), firms can focu