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Calculate your enterprise average cash receivable collection period and evaluate working capital health.
Days Sales Outstanding (DSO) measures the average number of days a business takes to collect cash receivables after completing a credit sale. Lower DSO frees up cash reserves to purchase inventory and fund operations.
Read full DSO Knowledge GuideA healthy DSO benchmark is 30 to 45 days for manufacturing and distribution enterprises, and 15 to 30 days for IT and professional services. A DSO exceeding 60 days signals delayed customer payments and trapped working capital.
DSO = (Accounts Receivable ÷ Total Credit Sales) × Number of Days in the period.