To succeed in turbulent times, Diversified Industrials should seek to reduce inventory liabilities while still maintaining performance, quality and service. The first step is to gain detailed visibility into operations and processes based on proper metrics and analysis.
A fast rate of inventory turnover equals a healthy revenue stream. Storage costs, obsolescence, and spoilage are the result of too much inventory kept too long. Alternatively, too little inventory can result in missed opportunities and loss of market share.
This brief report presents perspectives of inventory as both an asset and a liability. It looks at how excess inventory can be managed to improve financial performance.