Inventory management turnover rate

How does the inventory turnover rate indicate how efficient the pharmacist is at managing the inventory investment ... 

The most common ratio used to determine how well a pharmacy is managing its inventory is the inventory turnover rate (ITOR). It can be calculated for the entire pharmacy, for departments (e.g., prescriptions or OTC products), and even for individual products. The ITOR is expressed as a ratio and is calculated by using the following formula (Tootelian and Gaedeke, 1993 West, 2003, 2006) ... 

Good management practice will hold inventories at the lowest possible levels consistent with customer satisfaction and efficient plant operation. Excessive inventories are unproductive and are an investment having httle or no rate of return. Excessive inventories should be maintained only when supphes are erratic or rising in price. Management should normally aim for a high inventoiy-turnover ratio, as given by ... 

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