Nike Inc (NKE)
Days of inventory on hand (DOH)
| May 31, 2024 | May 31, 2023 | May 31, 2022 | May 31, 2021 | May 31, 2020 | ||
|---|---|---|---|---|---|---|
| Inventory turnover | 6.05 | 5.36 | 4.75 | 5.49 | 4.65 | |
| DOH | days | 60.33 | 68.11 | 76.77 | 66.53 | 78.42 |
May 31, 2024 calculation
DOH = 365 ÷ Inventory turnover
= 365 ÷ 6.05
= 60.33
Nike Inc's Days of Inventory on Hand (DOH) has shown a declining trend over the past five years, indicating a more efficient management of inventory levels. The company's DOH decreased from 78.42 days in 2020 to 60.33 days in 2024. This suggests that Nike has been able to turn its inventory into sales at a quicker pace in recent years, potentially leading to lower holding costs and better cash flow management.
The improvement in Nike's DOH can be attributed to effective inventory management practices, such as better demand forecasting, lean inventory strategies, and efficient supply chain management. A lower DOH indicates that Nike is able to sell its products more quickly, reducing the risk of obsolete inventory and minimizing the need for markdowns or discounts to clear out excess stock.
Overall, the decreasing trend in Nike's Days of Inventory on Hand reflects a positive development in the company's operational efficiency and effectiveness in managing its inventory levels. However, it is important for Nike to continue monitoring and optimizing its inventory turnover to ensure it aligns with market demands and business objectives.
Peer comparison
May 31, 2024