Sonoco Products Company (SON)
Inventory turnover
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 4,166,130 | 5,340,410 | 5,810,900 | 4,528,530 | 4,191,100 |
| Inventory | US$ in thousands | 1,016,140 | 773,501 | 1,102,180 | 562,114 | 450,691 |
| Inventory turnover | 4.10 | 6.90 | 5.27 | 8.06 | 9.30 |
December 31, 2024 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $4,166,130K ÷ $1,016,140K
= 4.10
The inventory turnover ratio for Sonoco Products Company has exhibited some fluctuations over the years. In 2020, the company's inventory turnover stood at 9.30, indicating that its inventory was sold and replaced approximately 9.30 times during the year. However, this ratio declined to 8.06 in 2021, suggesting a slightly lower rate of inventory turnover.
In 2022, there was a more significant decrease in the inventory turnover ratio to 5.27, which may indicate potential challenges in managing and selling inventory efficiently. This was followed by an improvement in 2023, with the ratio increasing to 6.90, although it remained below the 2020 levels.
By the end of 2024, Sonoco Products Company experienced a significant drop in its inventory turnover ratio to 4.10, signaling a substantial decrease in the frequency of inventory turnover compared to previous years. This trend warrants attention as it could imply potential issues such as excess inventory levels, slow-moving inventory, or challenges in predicting and meeting customer demand effectively. Overall, monitoring and analyzing the inventory turnover ratio can provide insights into the company's inventory management efficiency and operational performance.
Peer comparison
Dec 31, 2024