is a higher inventory turnover ratio better

is a higher inventory turnover ratio better refers to the concept that a higher inventory turnover ratio generally indicates a more efficient business operation. This ratio measures how quickly a company sells and replaces its inventory within a certain period, typically a year. A higher inventory turnover suggests that a business is selling products at a faster rate, which can lead to better cash flow and lower holding costs. However, an excessively high ratio may indicate stock shortages or missed sales opportunities. It’s important to find a balance and ensure that inventory levels align with customer demand and business operations.