Grocery Outlet Holding Corp (GO)
Inventory turnover
| 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cost of revenue (ttm) | US$ in thousands | 3,049,564 | 2,966,533 | 2,891,444 | 2,795,849 | 2,727,774 | 2,686,497 | 2,635,825 | 2,570,388 | 2,486,002 | 2,377,088 | 2,271,306 | 2,190,795 | 2,130,796 | 2,152,478 | 2,146,609 | 2,158,550 | 2,161,293 | 2,054,098 | 1,979,652 | 1,876,543 |
| Inventory | US$ in thousands | 394,152 | 396,893 | 367,313 | 362,730 | 349,993 | 308,605 | 320,344 | 316,397 | 334,319 | 331,891 | 318,424 | 297,394 | 275,502 | 245,844 | 248,172 | 243,270 | 245,157 | 252,777 | 229,273 | 188,346 |
| 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 |
December 31, 2024 calculation
Inventory turnover = Cost of revenue (ttm) ÷ Inventory
= $3,049,564K ÷ $394,152K
= 7.74
Inventory turnover is a key financial ratio that measures how efficiently a company manages its inventory. It indicates how many times, on average, a company sells and replaces its inventory during a specific time period. For Grocery Outlet Holding Corp, the trend in inventory turnover has been fluctuating over the past few years, ranging from a high of 9.96 (March 31, 2020) to a low of 7.13 (June 30, 2022).
A higher inventory turnover ratio typically indicates that a company is selling its inventory quickly, which can be a positive sign of efficiency. On the other hand, a lower ratio may suggest slower sales or excess inventory on hand, which could lead to storage costs and potential obsolescence.
Analyzing the data provided, we observe that Grocery Outlet Holding Corp's inventory turnover ratio peaked at 9.96 on March 31, 2020, and has generally been on a gradual decline since then. As of December 31, 2024, the ratio stood at 7.74. This downward trend could raise concerns about the company's inventory management efficiency and the potential risks associated with carrying excess inventory.
Management should closely monitor inventory levels, strive to balance stock levels with demand, and implement strategies to enhance inventory turnover to improve working capital management and overall operational efficiency.
Peer comparison
Dec 31, 2024
Dec 31, 2024