Tractor Supply Company (TSCO)
Days of inventory on hand (DOH)
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Inventory turnover | 3.34 | 3.53 | 3.41 | 3.77 | 3.85 | |
| DOH | days | 109.28 | 103.54 | 107.12 | 96.90 | 94.90 |
December 31, 2024 calculation
DOH = 365 ÷ Inventory turnover
= 365 ÷ 3.34
= 109.28
The days of inventory on hand (DOH) for Tractor Supply Company have shown a slight increasing trend over the past five years, starting at 94.90 days on December 31, 2020, and reaching 109.28 days on December 31, 2024. This indicates that, on average, it took the company longer to sell its inventory at the end of each year during this period.
The increase in DOH may imply a decrease in inventory turnover efficiency or challenges in managing inventory levels effectively. Tractor Supply Company may need to assess its inventory management practices to improve cash flow and reduce holding costs associated with maintaining excess inventory.
It is important for the company to strike a balance between having enough inventory to meet customer demand and reducing excess inventory levels to optimize its working capital and overall operational efficiency. Monitoring and controlling the DOH metric can help Tractor Supply Company enhance its inventory management strategies for better financial performance in the future.
Peer comparison
Dec 31, 2024