“Companies want to keep as little inventory as possible to minimize the risk that it won’t be sold, but if a company produces too few units, it gives up sales. As a result, computer companies want to try for a fairly low inventory-on-hand ratio, which Apple has certainly done. It turns out the company kept an average of just five days’ worth of inventory on hand for its products during the holiday season.
Keeping five days of inventory around is cutting it a little close, and the low figure last quarter may have been due in part to iMac supplies shrinking in advance of the launch of the new models. Still, Apple kept less inventory on hand than companies like Dell and Lenovo, which had seven and 15 days of inventory on hand, respectively. HP kept 32 days’ worth of product around, while Intel had three months of chips. And, as it just so happens, supply chain management is the realm of COO Tim Cook, so we’ve got some first-hand evidence here of his operating prowess.”