Turnover

What is Turnover?

Turnover is a measure of the sales of a company over a period of time. It is calculated by dividing the total sales by the average number of days in the period. Turnover is often used as a measure of a company's growth and profitability.

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There are two main types of turnover:

• Gross turnover is the total sales of a company before any costs are deducted.
• Net turnover is the total sales of a company after all costs have been deducted.

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Turnover is an important metric for businesses because it can help them to understand their financial performance. For example, a company with a high turnover is likely to be more profitable than a company with a low turnover. Additionally, turnover can be used to compare the performance of different companies in the same industry.

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There are a number of factors that can affect a company's turnover, including:

• The size of the company. Larger companies typically have a higher turnover than smaller companies.
• The industry in which the company operates. Some industries, such as retail and manufacturing, have a higher turnover than others, such as financial services.
• The economic climate. A strong economy typically leads to higher turnover, while a weak economy leads to lower turnover.

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Turnover is a valuable metric for businesses, but it should be used in conjunction with other financial metrics to get a complete picture of a company's financial health.