United Natural Foods Inc (UNFI)
Receivables turnover
| Jul 29, 2023 | Jul 30, 2022 | Jul 31, 2021 | Aug 1, 2020 | Aug 3, 2019 | ||
|---|---|---|---|---|---|---|
| Revenue | US$ in thousands | 30,138,000 | 28,858,000 | 26,755,000 | 26,303,000 | 22,127,200 |
| Receivables | US$ in thousands | 908,000 | 1,233,000 | 1,119,000 | 1,139,630 | 1,088,960 |
| Receivables turnover | 33.19 | 23.40 | 23.91 | 23.08 | 20.32 |
July 29, 2023 calculation
Receivables turnover = Revenue ÷ Receivables
= $30,138,000K ÷ $908,000K
= 33.19
The receivables turnover ratio measures how efficiently a company is able to collect its accounts receivable during a period. A higher turnover ratio indicates that the company is collecting its receivables more quickly.
Looking at the receivables turnover of United Natural Foods Inc. over the past five years, we can observe a consistent improvement in this metric. The ratio has increased from 20.07 in 2019 to 34.05 in 2023. This suggests that the company has been able to more effectively collect payments from its customers over the years.
A higher receivables turnover could be indicative of several positive factors, including a more aggressive or efficient credit and collection policy, improvements in the credit quality of the company's customers, or a tighter management of outstanding receivables. It may also indicate that the company is offering more favorable credit terms, resulting in quicker payment cycles.
However, it's important to note that an extremely high turnover ratio could also be a red flag, potentially indicating overly aggressive credit policies that may lead to reduced sales in the future due to strict credit terms.
In conclusion, the increasing trend in the receivables turnover ratio for United Natural Foods Inc. signals an improvement in the company's ability to efficiently collect payments from its customers, which is a positive indication of the company's management of its accounts receivable.
Peer comparison
Jul 29, 2023