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Inventory statistics?


#1

I was just foolin around and did a quick inventory by price points.
Figured how much by percentage of total inventory quantity, I have in
several price ranges.

When I get the time I’ll audit previous sales figures for those and
also for special order/custom.

It’d be interesting to see if actual numbers are in line with my gut
feeling, seeing how I’m a seat of the pants flyer. I’m no accountant
but I think these will be handy things to know.

Anyone who wants to chime in with what one can actually DO with these
figures I’d appreciate the input.


#2

Hi Neil

Your question is the heart and sole of what I help jewelers do. It’s
best to have a program for jewelers that does this in a flash. The
Edge is one (www.ajsllc.com) and the other one is Jewelry Shopkeeper
(www.jewelryshopkeeper.com)

These reports are from jewelry shopkeeper.

What you want to find is your Gross Margin Return on Investment.
This is your TOTAL sales from the cases with special orders from
those vendors WITHOUT (taken them out of the mix) memo, repairs,
custom design, etc.

Only sales of stuff you own. You find the gross profit for one year
(go back 365 days). So you have this gross profit number for 365 days
total.

Then you find your AVERAGE INVENTORY for the 365 day period. If you
don’t have these two programs, won’t be easy. Easiest way is
inventory level last November 1st added to inventory level this Oct
31st (that’s 1 year), added together and divided by “2”.

Better would be inventory levels on the 1st of the month, add all 12
together, get a big number, divide by 12 to get an AVERAGE.

Divide gross profit dollars by average inventory level. This should
give you a number above $1.00. Above a dollar means you’re making
more money from inventory than you keep in stock, which is what
people who make and have money in our business do.

I have setup for you a link to my website to download an Excel
worksheet where I’ve done the work for you.

http://www.jewelerprofit.com/GMROI_Worksheet.html

The idea is to 1st find the GMROI for the whole store.

Then find the GMROI for each department.

Then look at each department by price point.

Even price points should have (more or less-can’t be perfect) a
GMROI above $1.00.

Orchid won’t allow attachments otherwise I’d attach some screen
shots. It you want some screen shots of the reports, email me at
@dgeller

David
David Geller
www.JewelerProfit.com