Definition

Estimating future earnings after all expenses are paid. It helps set targets and plan for growth.

What to consider

  • Avoid both stockouts and excess inventory.
  • Monitor seasonal demand fluctuations.
  • Implement regular audits for accuracy.

Real world scenarios

  • A retail store uses inventory management software to track stock levels and reorder points.
  • A warehouse manager in Chicago reviews inventory turnover rates to prevent overstocking.
  • An online seller organizes inventory by product category to meet customer demand efficiently.

Related terms

Entrepreneurial Finances