Annualised Sales from stock (at cost price) ÷ Stock Value
Guideline: Franchise Specific
Description:
This version differs from version 1 on the previous page because it measures the parts that have been sold (at purchase price) rather than the parts that have simply been purchased for stock and is therefore a more accurate result.
The calculation still assesses the parts purchases for stock and excludes all parts that are purchased on a V.O.R. or E.O. basis.
Example:
A) Annualised Sales (at cost price) - R706,112 B) Annual V.O.R Sales (at cost price) = Ignore C) Parts Stock Value (at cost price) = R156,913 D) True Parts Stock Turn (per year) = 4.5 (A ÷ C)
If you are unable to obtain the purchase price of your sales, you could calculate it by using this method:
A) Annualised Sales from stock = R861,456 B) Annualised V.O.R Sales = Ignore C) GP on Sales from stock = R155,344 D) Cost price of Sales from stock = R706,112 (A - C) E) Parts Stock Value = R156,913 F) True Parts Stock Turn = 4.5 (D ÷ E)
This example is the most accurate of all as it captures the exact sales and the purchases made for those sales.