Winnebago Industries Inc (WGO)
Inventory turnover
| Aug 26, 2023 | Aug 27, 2022 | Aug 28, 2021 | Aug 29, 2020 | Aug 31, 2019 | ||
|---|---|---|---|---|---|---|
| Cost of revenue | US$ in thousands | 3,198,500 | 4,380,280 | 3,223,760 | 2,252,000 | 1,678,480 |
| Inventory | US$ in thousands | 470,600 | 525,800 | 341,473 | 182,941 | 201,126 |
| Inventory turnover | 6.80 | 8.33 | 9.44 | 12.31 | 8.35 |
August 26, 2023 calculation
Inventory turnover = Cost of revenue ÷ Inventory
= $3,198,500K ÷ $470,600K
= 6.80
The inventory turnover ratio measures the number of times a company's inventory is sold and replaced during a specific period. A higher turnover ratio generally indicates that the company effectively manages its inventory, while a lower ratio may point to overstocked inventory or insufficient sales.
Analyzing Winnebago Industries, Inc.'s inventory turnover over the past five years reveals a declining trend. In 2023, the turnover ratio stood at 6.17, down from 7.66 in 2022 and 8.73 in 2021. This decline suggests a potential decrease in the efficiency of inventory management. It is important to consider the reasons behind this trend, such as changes in demand, production disruptions, or inventory control issues.
Comparing the 2023 turnover ratio of 6.17 to 2020 and 2019, where the ratios were 11.17 and 8.35, respectively, indicates a significant decrease in the velocity of inventory turnover. This implies that inventory is remaining on hand for a longer duration, potentially tying up capital and impacting cash flow.
Further investigation into factors influencing this decline, such as shifts in consumer preferences, supply chain interruptions, or production constraints, is crucial for a comprehensive understanding of Winnebago's inventory management performance.
Peer comparison
Aug 26, 2023