Sprouts Farmers Market LLC (SFM)
Days of inventory on hand (DOH)
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Inventory turnover | 13.92 | 13.35 | 13.06 | 14.66 | 16.09 | |
| DOH | days | 26.23 | 27.34 | 27.95 | 24.90 | 22.69 |
December 31, 2024 calculation
DOH = 365 ÷ Inventory turnover
= 365 ÷ 13.92
= 26.23
The days of inventory on hand (DOH) ratio for Sprouts Farmers Market LLC has shown a gradual increase over the past five years. Specifically, the company maintained 22.69 days of inventory on hand as of December 31, 2020, which increased to 24.90 days by December 31, 2021, and further rose to 27.95 days by December 31, 2022. By the end of December 31, 2023, the DOH slightly decreased to 27.34 days before dropping to 26.23 days on December 31, 2024.
This trend suggests that Sprouts Farmers Market may be experiencing challenges in managing its inventory efficiently, potentially leading to a longer time for inventory to be converted into sales. Businesses typically aim to strike a balance between avoiding stockouts and minimizing excess inventory to optimize operational efficiency and working capital management. An increase in the DOH ratio may indicate potential issues in inventory control or demand forecasting, which could impact cash flow and profitability. Further analysis of inventory turnover and sales trends would provide deeper insights into the company's inventory management practices and overall financial performance.
Peer comparison
Dec 31, 2024