Cash Conversion Cycle Calculator
See how many days your cash is tied up between paying suppliers and collecting from customers, from revenue, cost of goods sold, inventory, receivables and payables.
Cash conversion cycle
67.2days
Days inventory outstanding (DIO)
63.3days
Days sales outstanding (DSO)
50.2days
Days payables outstanding (DPO)
46.2days
CCC = DIO + DSO − DPO; DIO = inventory ÷ COGS × days; DSO = receivables ÷ revenue × days; DPO = payables ÷ COGS × days
Cash conversion cycle formula
The cash conversion cycle (CCC) is the number of days between paying for stock and getting paid by customers. The shorter it is, the less cash a business needs to fund its working capital.
Cash conversion cycle formula
CCC = DIO + DSO − DPO
| Part | Formula | What it shows |
|---|---|---|
| DIO, days inventory outstanding | average inventory ÷ cost of goods sold × 365 | How long stock sits |
| DSO, days sales outstanding | average receivables ÷ revenue × 365 | How long customers take to pay |
| DPO, days payables outstanding | average payables ÷ cost of goods sold × 365 | How long you take to pay suppliers |
Example: revenue 2,400,000, cost of goods sold 1,500,000, inventory 260,000, receivables 330,000 and payables 190,000. DIO 63 days + DSO 50 days − DPO 46 days = a cycle of about 67 days.
How to shorten the cycle
- Cut DIO: buy closer to demand and clear slow stock (see the inventory turnover calculator).
- Cut DSO: invoice promptly, offer an early payment discount, follow up overdue invoices.
- Raise DPO: agree longer terms with suppliers, without paying late.
Copy the result, or save it as a PDF to attach to an email or a report. Nothing you type leaves your browser.
Features
- Days inventory outstanding (DIO)
- Days sales outstanding (DSO)
- Days payables outstanding (DPO)
- Cash conversion cycle
- Any period length
- Copy or PDF
Frequently asked questions
What is a good cash conversion cycle?
Lower is better. Many retailers run 30 to 60 days; some large online retailers have a negative cycle because they collect before paying suppliers.
Can the cash conversion cycle be negative?
Yes, when you pay suppliers later than you collect from customers. Suppliers are then funding your stock.
Should I use averages or year end balances?
Averages of opening and closing balances are better, especially for seasonal businesses. Use the same period for all figures.
Is the calculator free?
Yes. No sign up. It runs in your browser, and you can copy the result or save it as a PDF.