Benchmark Electronics Inc (BHE)

Inventory turnover

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Cost of revenue	US$ in thousands	2,567,910	2,631,100	2,049,420	1,878,080	2,082,570
Inventory	US$ in thousands	683,801	727,749	523,240	327,377	314,956
Inventory turnover		3.76	3.62	3.92	5.74	6.61

December 31, 2023 calculation

Inventory turnover = Cost of revenue ÷ Inventory
= $2,567,910K ÷ $683,801K
= 3.76

Inventory turnover is a key financial ratio that measures how efficiently a company manages its inventory. Benchmark Electronics Inc.'s inventory turnover has shown a decreasing trend from 6.57 in 2019 to 3.76 in 2023. This indicates that the company is holding onto its inventory for a longer period before selling it.

A lower inventory turnover can be a sign of overstocking, slow-moving inventory, or potential inefficiencies in inventory management. It may tie up more of the company's capital in inventory and may lead to carrying costs and potential obsolescence risks.

It is important for Benchmark Electronics Inc. to closely monitor its inventory turnover and take necessary steps to optimize its inventory management practices, such as improving demand forecasting, implementing just-in-time inventory systems, or optimizing supply chain efficiencies to improve liquidity and profitability.