Inventories

6 Months Ended

Jan. 31, 2021

INVENTORIES

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


	January 31, 2021		July 31, 2020
Finished goods	$	14,231	$	14,500
Packaging	5,029		4,587
Other	4,395		4,806
Total Inventories	$	23,655	$	23,893

Inventories are valued at the lower of cost (first-in, first-out) or net realizable value. Inventory costs include the cost of raw materials, packaging supplies, labor and other overhead costs. We performed a detailed review of our inventory items to determine if an obsolescence reserve adjustment was necessary. The review surveyed all of our operating facilities and sales groups to ensure that both historical issues and new market trends were considered. The obsolescence reserve not only considered specific items, but also took into consideration the overall value of the inventory as of the balance sheet date. The inventory obsolescence reserve values at January 31, 2021 and July 31, 2020 were $772,000 and $926,000, respectively. The obsolescence reserve decreased due to better management of inventory. Other inventories includes a variety of items including clay, additives, fragrances and other supplies and decreased from July 31, 2020 due to increased production. Conversely, packaging inventories increased from July 31, 2020 due to anticipated sales demand.