Unifirst Corporation (UNF)

Inventory turnover is a crucial financial ratio that helps assess how efficiently a company manages its inventory. It measures the number of times a company's inventory is sold and replaced over a specific period.

Over the past five years, Unifirst Corp.'s inventory turnover has shown fluctuations. In 2019, the company had an inventory turnover of 11.29, indicating that its inventory was sold and replaced approximately 11.29 times within the year. This was followed by a slight decrease in 2020 to 10.96, suggesting a slower turnover of inventory compared to the previous year.

However, in 2021, the inventory turnover decreased further to 7.95, which may indicate potential issues with inventory management or sales performance. It is essential for the company to investigate the reasons behind this decrease, as it could impact profitability and working capital efficiency.

In 2022, the inventory turnover improved to 8.63, indicating a positive trend in managing inventory efficiently. Finally, in 2023, Unifirst Corp. achieved an inventory turnover of 9.99, marking a continued improvement in inventory management.

Overall, the fluctuating trend in Unifirst Corp.'s inventory turnover over the past five years may reflect changes in sales, procurement, and inventory management processes. It is crucial for the company to closely monitor and manage its inventory turnover to ensure optimal utilization of resources and maintain profitability.

Peer comparison

Aug 26, 2023