Starbucks Corporation (SBUX)
Cash conversion cycle
| Sep 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 | Dec 31, 2019 | Sep 30, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | 48.19 | 48.30 | 45.66 | 50.46 | 56.19 | 57.92 | 61.79 | 65.66 | 66.02 | 60.57 | 53.27 | 54.01 | 54.55 | 54.57 | 52.16 | 52.39 | 61.06 | 50.34 | 44.56 | 46.10 |
| Days of sales outstanding (DSO) | days | 12.25 | 11.09 | 11.59 | 12.01 | 11.89 | — | — | 13.62 | — | — | — | 12.07 | 13.18 | 16.24 | 19.23 | 19.69 | 19.89 | 18.23 | 14.20 | 14.54 |
| Number of days of payables | days | 43.26 | 41.19 | 40.51 | 43.14 | 42.52 | 41.51 | 39.89 | 43.48 | 46.12 | 41.94 | 41.95 | 40.80 | 39.71 | 37.52 | 37.24 | 33.70 | 33.19 | 33.65 | 34.34 | 35.86 |
| Cash conversion cycle | days | 17.18 | 18.20 | 16.74 | 19.33 | 25.56 | 16.40 | 21.89 | 35.79 | 19.91 | 18.63 | 11.31 | 25.28 | 28.02 | 33.30 | 34.15 | 38.39 | 47.76 | 34.91 | 24.42 | 24.78 |
September 30, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= 48.19 + 12.25 – 43.26
= 17.18
The cash conversion cycle of Starbucks Corporation has fluctuated over the past 2 years, indicating variations in the efficiency of its working capital management. In general, the company takes an average of around 20 days to convert its investments in inventory and other resources into cash from the sale of goods or services.
The cycle appears to have peaked at 47.76 days in December 2019, indicating a prolonged period to complete this conversion process, possibly due to issues like slow inventory turnover or slower collections from customers. However, the cycle has since improved, with the most recent figure of 17.18 days reflecting a more efficient cash conversion process.
Overall, Starbucks' management of its cash conversion cycle seems to have shown some positive trends in recent periods, which could potentially signify an enhanced focus on improving working capital efficiency and liquidity management. Further monitoring of this metric will be essential to assess the company's ongoing financial performance and liquidity position.
Peer comparison
Sep 30, 2024
See also:
Starbucks Corporation Cash Conversion Cycle (Quarterly Data)