Turnover: what is this?

Turnover is one of the main and most important indicators in the economy of trading activity. How is this concept treated? It is generally accepted that turnover is an action based on the exchange of a particular commodity on a currency. Thus, there is a continuous process of movement of goods and services, carried out through the preparation of agreements or sales transactions.

This concept can be viewed from two points of view. On the one hand, commodity turnover is a movement in which the emphasis is on the commodity as a direct object of trading activity. And on the other hand, all attention is focused on the sale-purchase transaction, since it is an instrument of promotion of the goods first to the market, and then directly to the consumer.

Currently, there are separate organizations specializing in conducting trading activities. They sell the goods of the manufacturer and get their percentage of the transaction. The products come from the manufacturer on consignment terms. Thus, the company has only the right to implement a specific product. For the economic entity itself, commodity turnover is the way to achieve an economic effect, that is, to obtain maximum profit. And at the market level, this indicator reflects the degree of equipping the population with the necessary goods, and therefore, in some way characterizes the standard of living of citizens.

Turnover can be divided into two main groups: wholesale and retail. The first one reveals the process of the movement of goods to the place where it is directly transmitted. We can say that retail turnover is the final stage in the movement of products. If we consider this concept as an economic indicator, then we can present it as a monetary expression of the volume of goods released to the market. On the one hand, the turnover in retail trade is reflected in the amount of income from sales, and on the other hand - it describes the level of the population's expenses for the purchase of products.

According to the current legislation, this indicator includes not only the volume of proceeds from the sale of the assortment to the population, but also the sales volume to other counterparties purchasing goods for the purpose of servicing citizens. The indicator of retail trade turnover can fully reflect the degree of development of the enterprise, the welfare of the target audience and even the overall situation of the national economy.

Wholesale turnover represents the movement of products to other trading organizations for the purpose of further resale or to other enterprises for use in their production activities as raw materials. Unlike retail, in the wholesale trade, production remains in the sphere of circulation.

You can classify the wholesale turnover by purpose: intrasystem and for sale. The first category is inherent in large-scale commercial companies, as it reflects the movement of goods from a trading enterprise to another wholesale seller. And in accordance with the criterion for the implementation of the enterprise delivers the finished goods to retailers in the catering network, for the purpose of clearing exchange, as well as for export for export. When summing the results of the indicators of these two categories, you can get a gross or aggregate wholesale turnover.

A clear distinction is made between the terms "composition" and "magnitude" of turnover. In no case can they be identified. The composition of the indicator reveals a variety of types of sales, and its value is the amount of revenue from sales, cash on hand and funds in bank accounts. This division is due to the fact that commodity turnover can be regarded as a qualitative and as a quantitative indicator.