Starbucks Corporation (SBUX)
Days of inventory on hand (DOH)
| Sep 30, 2024 | Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | ||
|---|---|---|---|---|---|---|
| Inventory turnover | 7.57 | 7.23 | 5.56 | 6.76 | 6.30 | |
| DOH | days | 48.19 | 50.46 | 65.66 | 54.01 | 57.90 |
September 30, 2024 calculation
DOH = 365 ÷ Inventory turnover
= 365 ÷ 7.57
= 48.19
To analyze Starbucks Corporation's days of inventory on hand (DOH) over the past five years, we can observe that the trend has been fluctuating. In fiscal year 2020, the DOH was 57.90 days, which decreased to 54.01 days in 2021. However, in 2022, there was a significant increase to 65.66 days, followed by a decrease to 50.46 days in 2023. In the most recent fiscal year 2024, the DOH further decreased to 48.19 days.
The decreasing trend in the past two years indicates that Starbucks has been more efficient in managing its inventory, possibly through better inventory control practices or demand forecasting. A lower DOH typically signifies that the company is selling its inventory more quickly, which can result in lower carrying costs and reduced risk of obsolescence.
However, it is important to note that a very low DOH could potentially indicate stockouts or lost sales if the company does not have enough inventory to meet customer demand. Therefore, Starbucks should continue to monitor its DOH and strike a balance between minimizing inventory costs and ensuring adequate stock levels to meet customer demand.
Peer comparison
Sep 30, 2024