Scotts Miracle-Gro Company (SMG)
Days of inventory on hand (DOH)
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | ||
|---|---|---|---|---|---|---|
| Inventory turnover | 4.13 | 3.20 | 3.79 | 5.82 | 5.24 | |
| DOH | days | 88.45 | 113.98 | 96.24 | 62.67 | 69.72 |
September 30, 2023 calculation
DOH = 365 ÷ Inventory turnover
= 365 ÷ 4.13
= 88.45
The days of inventory on hand (DOH) for Scotts Miracle-Gro Company has fluctuated significantly over the past five years. In 2019, the DOH was 92.56 days, and it increased to 81.99 days in 2020 before rising further to 119.84 days in 2021. This was followed by a substantial increase to 169.62 days in 2022, but then decreased to 118.64 days in 2023.
These fluctuations suggest some variability in the company's inventory management efficiency. A higher DOH indicates a longer time for the company to sell its inventory, potentially leading to higher carrying costs and obsolescence risks. Conversely, a lower DOH indicates a shorter time to sell inventory, which may suggest more efficient inventory management.
This trend warrants further investigation into the company's inventory management practices to identify the factors driving these fluctuations and to implement strategies to optimize inventory levels. It is important for the company to maintain a balance in maintaining adequate inventory to meet customer demand while minimizing carrying costs and the risk of holding obsolete inventory.
Peer comparison
Sep 30, 2023