JM Smucker Company (SJM)
Inventory turnover
| Apr 30, 2024 | Apr 30, 2023 | Apr 30, 2022 | Apr 30, 2021 | Apr 30, 2020 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 6,837,400 | 7,403,000 | 7,057,300 | 6,690,900 | 6,589,400 |
| Inventory | US$ in thousands | 1,038,900 | 1,009,800 | 1,089,300 | 959,900 | 895,300 |
| Inventory turnover | 6.58 | 7.33 | 6.48 | 6.97 | 7.36 |
April 30, 2024 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $6,837,400K ÷ $1,038,900K
= 6.58
The inventory turnover ratio for JM Smucker Company has been relatively stable over the past five years, ranging from 6.48 to 7.36. This ratio indicates how efficiently the company is managing its inventory by measuring the number of times the inventory is sold and replaced within a given period.
A higher inventory turnover ratio generally signifies that the company is selling its inventory quickly and efficiently. In JM Smucker's case, the downward trend from 7.36 in 2020 to 6.58 in 2024 suggests a slight decrease in the rate at which the company is turning over its inventory. This could be due to factors such as changes in consumer demand, supply chain disruptions, or inventory management issues.
Overall, with an average inventory turnover ratio of approximately 6.78 over the past five years, JM Smucker Company appears to have a good level of inventory turnover, indicating effective management of its inventory levels. However, monitoring this ratio over time and in comparison to industry benchmarks can help identify any potential areas for improvement in inventory management efficiency.