Posts Tagged ‘ GMROI ’

Turn Earn Calculation and GMROI to Manage Inventory

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The Turn/Earn Index and Gross Margin Return on Inventory (GMROI) are two simple ways to help manage your inventory and run your business. Want to know what GMROI means? Read on! Turn-Earn Index definition Turn-Earn Index defined: Turn and earn is a ratio that analyzes inventory turnover and gross margin. To calculate multiply inventory turns by gross margin percentage. Using the Turn Earn Index to manage inventory If you’re a purchasing manager or accountant you may want to justify selling of stocking a SKU (stock keeping unit) with the Turn/Earn Index. Also known as the Turn/Earn calculation or Turn/Earn...

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How A Price Increase/Decrease Affects Gross Profit vs. Unit Sales

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(Note: if you just need to calculate gross margin or mark up, please scroll down.) If you want to increase gross margin with a price increase, you should know how gross profit is calculated and assuming a drop in unit sales, how many unit sales are needed to maintain the same gross profit. On the other hand if you’re considering a sale you should know how many additional unit sales are needed to maintain the same gross profit. You need to know how total unit sales can drop (for a price increase) or need to increase (for a price...

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Rule of Three Marketing: Market Share and Market Dynamics

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Why do some companies thrive and dominate their market segment, only to later become an afterthought? Market dynamics and the Rule of Three explains how some companies succeed and some fail. Most industries and market segments, including the automotive aftermarket, will have market share dominated by three competing companies. This article will take that a step further and show how companies using the Rule of Three can plan a market share strategy that will help ensure profits in the future. Rule of Three marketing defined To revisit an October 2003 article we wrote for SEMA News, market share is...

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