Grocery Outlet Holding Corp (GO)
Days of inventory on hand (DOH)
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Inventory turnover | 7.74 | 7.47 | 7.87 | 7.71 | 7.79 | 8.71 | 8.23 | 8.12 | 7.44 | 7.16 | 7.13 | 7.37 | 7.73 | 8.76 | 8.65 | 8.87 | 8.82 | 8.13 | 8.63 | 9.96 | |
| DOH | days | 47.18 | 48.83 | 46.37 | 47.35 | 46.83 | 41.93 | 44.36 | 44.93 | 49.09 | 50.96 | 51.17 | 49.55 | 47.19 | 41.69 | 42.20 | 41.14 | 41.40 | 44.92 | 42.27 | 36.63 |
December 31, 2024 calculation
DOH = 365 ÷ Inventory turnover
= 365 ÷ 7.74
= 47.18
Days of Inventory on Hand (DOH) is a key financial ratio that indicates how efficiently a company is managing its inventory. It is calculated by dividing the average inventory balance by the cost of goods sold and then multiplying by the number of days in the period.
Analyzing the DOH trend for Grocery Outlet Holding Corp from March 31, 2020, to December 31, 2024, reveals fluctuations in inventory management efficiency. The DOH ranged from a low of 36.63 days in March 2020 to a high of 51.17 days in June 2022, indicating varying levels of inventory turnover over the period.
From March 2020 to December 2021, the DOH generally increased, suggesting the company was holding onto inventory for longer periods. However, the ratio decreased from December 2021 to March 2022, indicating an improvement in inventory turnover efficiency.
Subsequently, the DOH increased again from March 2022 to September 2024, reaching a peak of 50.96 days in September 2022 before slightly declining in the last quarter of 2024. The fluctuations in the DOH may reflect changes in inventory management practices, seasonal variations in demand, or disruptions in the supply chain.
Overall, a downward trend in the DOH is generally favorable as it signifies faster inventory turnover, freeing up capital and reducing the risk of holding obsolete inventory. However, a consistently low DOH could indicate stockouts or missed sales opportunities. Grocery Outlet Holding Corp should continue to monitor its DOH and evaluate its inventory management strategies to strike a balance between inventory levels and customer demand.
Peer comparison
Dec 31, 2024