Written by Norene Anderson
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GMROI is an abbreviation for Gross Margin Return On Inventory. It is actually a measure of gross profitability of an item. It is the most widely used productivity measurement for retailers. It is a reflection of the relationship between margins and turns. It affects both cash flow and profit. This is a successful tool to use to increase inventory productivity.

There are many ways to track it. It can be calculated by item, vendor, or a class of items. It is also key in determining if you have enough inventory on hand. A high GMROI should alert you to check your fill rate. If the fill rate is low, then you may need to increase the amount on hand. You can use it to evaluate the performance of merchandise departments, shops, or vendors. You can also use industry averages and compare your productivity with competitors.

Increase Profits by Monitoring GMROI

With the right software program, you can use your sales plan to compute the GMROI for every retail department you generate before you place your order. You can have calculations at any given minute to guide you in making your most challenging business decisions. Take the guesswork out of your inventory planning and start seeing the favorable results immediately.

There are all kinds of helps available on the Internet to guide you toward having a successful and profitable retail business. With just a few clicks of the mouse, you can be on your way to finding the one that is best for you. Take time to evaluate your need and find the solution today. Your online order is safe and secure and you can start training and using the software right away.

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