Re: Inventory Turnover -- MAPICS-L

Nandu,

the 'apics' definition of inventory turns is 'annual cost of sales' divided by 'Average Inventory value' ie if COS is 20 million and AVE. Inventory is 1 million (all production inventories) the turn is '20'. COS (items sold * std cost will include all lower level matl, labor, and OH cost).

mapics tracks the mtd and ytd sales qty in the itembl file.

you could take mtd sales * 12 (annualize) / current inventory value

this would give you a rough idea of turns this month / (ratio of sales to inventory) , and allow you to plot a trend, without a lot of data manipulation. See if this is adaquate for mgm objectives.

Let me know what you come up with.

footnote: remember the goal is to carry just the inventory required to facilitate customer service. We need to balance the Inv cost with the cost of ordering and 'stock outs'.

Hope this helps

Jeff Snyder,   CPIM
Mapics Consultant


From: "Nandagopal Padmanabhan" <npadmanabhan@xxxxxxxxxxxxxx>
Reply-To: MAPICS ERP System Discussion <mapics-l@xxxxxxxxxxxx>
To: "MAPICS ERP System Discussion" <mapics-l@xxxxxxxxxxxx>
Subject: Inventory Turnover
Date: Thu, 17 Apr 2003 15:30:42 -0700

Hello Group, I need some suggestions for creating inventory turnover reports. I suppose I'll have to query the IM Transaction History File for this and you all know that this file grows in size exponentially. My guess is this file already contains 200,000 records. Here are my questions:

(1) If I were to write a query that is going to pick all 'SA' transactions with order type 'CO' and multiply the quantity by the average unit cost for each line item to get the total cost of goods sold (this can then be used in another query to determine inventory turns), how big a load will this be on the AS400? I'm asking this question as I was asked to be careful while querying the IMHIST file.

(2) Is the above approach a general practice for creating inventory turnover reports? Could you suggest other ways to run an inventory turnover report.

Your suggestions will be appreciated.

Regards,
Nandu

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