Cash Conversion Cycle Calculator

CCC = DIO + DSO − DPO. It measures the number of days cash is tied up between paying suppliers and collecting from customers. A shorter cycle frees up working capital.

Days Inventory Outstanding is how long stock sits before sale; Days Sales Outstanding is how long customers take to pay; Days Payables Outstanding is how long you take to pay suppliers.

Yes - a negative cycle means you collect from customers before paying suppliers, effectively funding operations with supplier credit. Amazon and many retailers run negative cycles.

Turn inventory faster (lower DIO), collect receivables sooner (lower DSO), or negotiate longer supplier terms (higher DPO) - without harming supplier relationships or sales.

It varies enormously: grocers can run at 5-15 days, apparel retailers at 30-60 days, and machinery manufacturers at 90-150 days. What matters most is not the absolute number but the trend: a CCC that climbs quarter after quarter is a warning sign of working-capital pressure.

Offer early-payment discounts (for example, 2% off if paid within 10 days), invoice immediately once the service is complete, set up automated collection reminders, review credit limits for customers with a slow payment history, and consider factoring for problem receivables.

The operating cycle (DIO + DSO) is the time between buying inventory and collecting the customer's payment. The CCC subtracts DPO because supplier payment terms act as free financing. An operating cycle of 100 days with a DPO of 40 days gives a CCC of 60 days: you only need to fund 60 days, not 100.