INVENTORIES

The composition of inventories is as follows (in thousands):



	January 31, 2014		July 31, 2013
Finished goods	$	13,130	$	12,112
Packaging	5,191		4,003
Other	4,413		4,608
Total Inventories	$	22,734	$	20,723

Inventories are valued at the lower of cost (first-in, first-out) or market. Inventory costs include the cost of raw materials, packaging supplies, labor and other overhead costs. We perform a quarterly review of our inventory items to determine if an obsolescence reserve adjustment is necessary. The review surveys all of our operating facilities and sales groups to ensure that both historical issues and new market trends are considered. The allowance not only considers specific items, but also takes into consideration the overall value of the inventory as of the balance sheet date. The inventory obsolescence reserve values at January 31, 2014 and July 31, 2013 were $348,000 and $364,000, respectively.