Williams-Sonoma Inc (WSM)
Payables turnover
| Jan 28, 2024 | Oct 29, 2023 | Jul 30, 2023 | Apr 30, 2023 | Jan 29, 2023 | Oct 30, 2022 | Jul 31, 2022 | May 1, 2022 | Jan 30, 2022 | Oct 31, 2021 | Aug 1, 2021 | May 2, 2021 | Jan 31, 2021 | Nov 1, 2020 | Aug 2, 2020 | May 3, 2020 | Feb 2, 2020 | Nov 3, 2019 | Aug 4, 2019 | May 5, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cost of revenue (ttm) | US$ in thousands | 2,069,408 | 2,014,847 | 2,076,357 | 2,158,726 | 2,181,911 | 2,245,113 | 2,239,438 | 2,206,238 | 2,178,847 | 2,141,319 | 2,007,080 | 1,837,633 | 1,741,192 | 1,667,097 | 1,652,399 | 1,684,254 | 1,673,218 | 1,693,246 | 1,677,565 | 1,669,645 |
| Payables | US$ in thousands | 607,877 | 675,505 | 597,104 | 629,561 | 508,321 | 720,856 | 680,097 | 642,619 | 612,512 | 638,371 | 601,879 | 574,876 | 542,992 | 562,294 | 373,086 | 423,375 | 521,235 | 444,279 | 404,337 | 385,646 |
| Payables turnover | 3.40 | 2.98 | 3.48 | 3.43 | 4.29 | 3.11 | 3.29 | 3.43 | 3.56 | 3.35 | 3.33 | 3.20 | 3.21 | 2.96 | 4.43 | 3.98 | 3.21 | 3.81 | 4.15 | 4.33 |
January 28, 2024 calculation
Payables turnover = Cost of revenue (ttm) ÷ Payables
= $2,069,408K ÷ $607,877K
= 3.40
The payables turnover ratio of Williams-Sonoma Inc has shown fluctuations over the past few quarters. The ratio indicates how efficiently the company is managing its trade payables by measuring the number of times per year the company pays its average accounts payable balance.
Williams-Sonoma's payables turnover ratio has ranged from 2.96 to 4.43 over the 20 quarters presented. A higher turnover ratio generally suggests that the company is paying its suppliers more frequently, which can be beneficial in terms of maintaining good relationships with suppliers and potentially negotiating better terms.
In analyzing the trend, we can observe that the payables turnover ratio has generally been above 3.0, indicating that Williams-Sonoma is effectively managing its trade payables. The peak at 4.43 in the first quarter of 2020 may indicate a more aggressive approach to managing payables during that period, possibly driven by specific factors such as changes in the company's operating cycle or supplier relationships.
Overall, the payables turnover ratio for Williams-Sonoma Inc reflects a consistent and efficient approach to managing its accounts payable, which is crucial for maintaining strong supplier relationships and optimizing cash flow management. It is important to continue monitoring this ratio in conjunction with other financial metrics to assess the company's overall financial health and operational efficiency.