LITTLETON, Colo.-Wireless carrier inventory levels increased 13 percent between the third quarter of 2003 and the final three months of last year, which translated into a $215 million increase in inventory levels and an increase in days of sales from 42.5 days to 48.2 days, according to a report from InfoTech Marketing.
The report noted the increase offset gains the industry made during the third quarter of last year and was partly due to seasonality as the “carriers likely will see a decline in the first quarter.”
InfoTech added that its models show that carrying only 30 days of inventory could generate nearly $700 million of cash flow and that carriers can reduce their inventory levels through a commitment to inventory management, better forecasting and improved ordering procedures.
Of the wireless carriers sampled, Sprint PCS affiliate US Unwired Inc. achieved the greatest efficiency during the fourth quarter with 32.5 days of sales in inventory compared with 36.5 days during the third quarter. Fellow affiliates Alamosa Holdings Inc. and AirGate PCS Inc. rounded out the top three with 34.5 days and 36.4 days of sales respectively. The least efficient carrier was U.S. Cellular Corp., which reported 89.4 days of sales in inventory during the fourth quarter followed by 70.1 days for Triton PCS Inc. and 69.1 days for Rural Cellular Corp.
