Williams-Sonoma Inc (WSM)
Days of sales outstanding (DSO)
| Jan 28, 2024 | Jan 29, 2023 | Jan 30, 2022 | Jan 31, 2021 | Feb 2, 2020 | ||
|---|---|---|---|---|---|---|
| Receivables turnover | 63.06 | 74.98 | 62.62 | 47.23 | 52.85 | |
| DSO | days | 5.79 | 4.87 | 5.83 | 7.73 | 6.91 |
January 28, 2024 calculation
DSO = 365 ÷ Receivables turnover
= 365 ÷ 63.06
= 5.79
The Days of Sales Outstanding (DSO) ratio measures the average number of days it takes a company to collect revenue after making a sale. A lower DSO value indicates that the company is collecting payments more quickly, which is generally seen as a positive sign.
Analyzing Williams-Sonoma Inc's DSO over the past five years, we can observe the following trends:
1. In the latest fiscal year (ending Jan 28, 2024), the DSO stood at 5.79 days, which is higher than the previous year's figure of 4.87 days.
2. Prior to the decrease in DSO in the current year, there was a slight increase in DSO in the fiscal year ending Jan 30, 2022.
3. The highest DSO value of 7.73 days was recorded in the fiscal year ending Jan 31, 2021, indicating a longer collection period at that time.
4. The lowest DSO value of 4.87 days was achieved in the fiscal year ending Jan 29, 2023, suggesting an efficient collection process during that period.
Overall, Williams-Sonoma Inc's DSO has fluctuated over the past five years, with some improvement in collection efficiency in certain years and a slight increase in the most recent fiscal year. Further analysis of the company's credit policies, customer payment trends, and industry benchmarks could provide insights into the effectiveness of its accounts receivable management.