Cracker Barrel Old Country Store (CBRL)

Days of inventory on hand (DOH)

		Aug 2, 2024	Jul 28, 2023	Jul 29, 2022	Jul 30, 2021	Jul 31, 2020
Inventory turnover		14.89	13.79	11.47	15.04	14.05
DOH	days	24.51	26.46	31.82	24.27	25.98

August 2, 2024 calculation

DOH = 365 ÷ Inventory turnover
= 365 ÷ 14.89
= 24.51

The days of inventory on hand (DOH) ratio measures how efficiently a company manages its inventory. A lower DOH indicates that the company is selling inventory quickly and efficiently, while a higher DOH suggests that the company may be holding onto excess inventory, which could tie up capital and potentially lead to obsolescence.

Analyzing the trend in Cracker Barrel Old Country Store's DOH ratio over the past five years, we can observe the following:
- In the most recent fiscal year ending August 2, 2024, the DOH ratio improved to 24.51 days compared to the previous year, indicating that the company was able to sell its inventory more quickly.
- The trend of decreasing DOH ratios over the past two years suggests that Cracker Barrel has become more efficient in managing its inventory levels.
- While the DOH ratio for fiscal year 2022 was relatively high at 31.82 days, it decreased significantly in the subsequent years, indicating enhanced inventory management.

Overall, the decreasing trend in Cracker Barrel's DOH ratio over the past five years implies that the company has been more efficient in managing its inventory levels, potentially leading to improved cash flow and profitability. Continued monitoring of the DOH ratio will be vital to assess the company's ongoing effectiveness in inventory management.