Arrow Electronics Inc (ARW)
Days of inventory on hand (DOH)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Inventory turnover | 5.58 | 6.07 | 7.20 | 7.75 | 7.37 | |
| DOH | days | 65.38 | 60.13 | 50.66 | 47.09 | 49.54 |
December 31, 2023 calculation
DOH = 365 ÷ Inventory turnover
= 365 ÷ 5.58
= 65.38
Arrow Electronics Inc.'s Days of Inventory on Hand (DOH) ratio has shown a fluctuating trend over the past five years. In 2023, the DOH increased to 65.38 days from 60.13 days in 2022, indicating that the company held inventory for a longer period before selling it. This could suggest potential issues such as slow-moving inventory or challenges in managing the supply chain efficiently. Comparing 2023 to 2021, there is a noticeable increase in DOH, indicating a longer period of inventory holding. However, the DOH in 2023 is still higher than both 2022 and 2021.
It is important for Arrow Electronics Inc. to closely monitor and analyze the reasons behind the increase in DOH to ensure optimal inventory management. High DOH can tie up working capital, increase storage costs, and potentially lead to obsolescence of inventory. By implementing strategies to better manage inventory levels, such as improving demand forecasting and streamlining operations, the company can work towards reducing its DOH and improving overall efficiency in inventory management.
Peer comparison
Dec 31, 2023