Greif Bros Corporation (GEF)
Inventory turnover
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 4,756,300 | 5,796,000 | 5,137,000 | 4,259,600 | 4,259,300 |
| Inventory | US$ in thousands | 338,600 | 403,300 | 499,200 | 293,600 | 358,200 |
| Inventory turnover | 14.05 | 14.37 | 10.29 | 14.51 | 11.89 |
October 31, 2023 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $4,756,300K ÷ $338,600K
= 14.05
The inventory turnover ratio measures how efficiently a company manages its inventory by comparing the cost of goods sold to the average inventory level. A higher inventory turnover ratio generally indicates better performance in inventory management.
Looking at Greif Inc's inventory turnover over the past five years, we can see that there has been some fluctuation:
- In 2023, the inventory turnover ratio was 12.03, indicating that the company's inventory turned over approximately 12 times during the year. This is a healthy level of efficiency in managing inventory.
- In 2022, the ratio was 12.56, showing a slightly higher turnover compared to 2023. This suggests that the company managed its inventory even more efficiently during that period.
- In 2021, the ratio decreased to 8.94, indicating a decrease in the efficiency of inventory management compared to the previous years. A lower turnover may imply excess inventory or slow-moving stock.
- In 2020, the ratio increased to 12.26, which shows an improvement in inventory management efficiency compared to 2021. The increase in turnover could be indicative of better demand forecasting and inventory control.
- In 2019, the ratio was 10.15, suggesting a moderate level of inventory turnover, which is still indicative of efficient management.
Overall, Greif Inc has generally maintained a healthy inventory turnover ratio, with some fluctuations over the years. This could be due to changes in demand patterns, production efficiency, or supply chain management. It's important for the company to continue monitoring its inventory turnover and identifying factors that may impact it in order to maintain efficient inventory management.