Ralph Lauren Corp Class A (RL)

Days of inventory on hand (DOH)

		Mar 31, 2024	Mar 31, 2023	Mar 31, 2022	Mar 31, 2021	Mar 31, 2020
Inventory turnover		2.44	2.13	2.12	2.03	3.40
DOH	days	149.71	171.67	172.24	179.96	107.21

March 31, 2024 calculation

DOH = 365 ÷ Inventory turnover
= 365 ÷ 2.44
= 149.71

Ralph Lauren Corp Class A's days of inventory on hand (DOH) have displayed fluctuations over the past five years. The trend indicates that the company has made progress in managing its inventory levels more efficiently from 2021 to 2023, with the DOH decreasing from 179.96 days to 171.67 days and then further to 149.71 days. This suggests that the company may have implemented better inventory management practices or experienced improved inventory turnover during these periods.

However, the sudden increase in DOH in 2022 to 172.24 days raises some concerns as it indicates a potential buildup of inventory relative to sales. A high DOH value can tie up capital in inventory and may lead to increased carrying costs and the risk of obsolescence.

The significant drop in DOH in 2020 to 107.21 days could suggest an aggressive inventory management strategy, possibly in response to the uncertainties brought about by the global pandemic. Nevertheless, it is essential for Ralph Lauren Corp to maintain an optimal balance in managing its inventory levels to ensure efficient operations and healthy cash flow.

Overall, Ralph Lauren Corp Class A's DOH trend signals the importance of continuous monitoring and adjustment of inventory levels to align with sales demand and optimize financial performance.