Inventories grow leaner relative to sales
November 17, 2011
Inventories relative to sales were were unchanged in September from an August ratio that was revised downward from preliminary numbers, according to the latest U.S. Census Bureau figures. The inventories-to-sales ratio throughout the economy was 1.27 on a seasonally adjusted basis in both August and September. The inventories-to-sales ratio remains very lean at a level not much higher than the all-time low of 1.25 recorded in March. The continuation of lean inventories is good news for trucking companies because it indicates that businesses are maintaining normal replenishment cycles and that any uptick in sales should translate into shipments.
Inventories were virtually flat in September as sales rose 0.6% over August. The inventories-to-sales ratio at manufacturers and retailers in September was 1.33 while the ratio at merchant wholesalers was 1.15. Drilling down to broad categories of retail establishments, the highest seasonally adjusted inventories-to-sales ratio in August was 2.39 at clothing stores. The leanest ratio, as usual, was at food and beverage outlets, where the ratio was 0.77, according to Census Bureau figures. The largest drop in the ratio was from 2.01 to 1.91 at motor vehicle and parts dealers.
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