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"If a retailer wants to double its revenue, there are two basic options. Double your margins. Or double your volume by cutting the time you hold inventory in ha
by martinced 14y ago
"If a retailer wants to double its revenue, there are two basic options. Double your margins. Or double your volume by cutting the time you hold inventory in half."
So there's an unlimited amount of buyers willing to buy and every time you cut the time you hold the inventory in half people shall buy twice as much?
- suby 14y agoI think they cut the time inventory is held in half by charging less and not making as much per sale, but making it up by moving more inventory.
- btilly 14y agoIf you take shipments in fixed sized lots, every time you double your sales rate, you've cut how long you have to hold each item in half. Furthermore it gets better. Frequently if you have good credit, you can take a shipment, sell it, and then pay later. This gives you float that you can use for things like paying the overhead of keeping unpopular items in stock. (Remember, Amazon makes substantial money both from having things that are hard to find elsewhere, and by selling commodity items in bulk.)