Free tool

Cash conversion cycle calculator

See how many days your cash is tied up between paying suppliers and collecting from customers.

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Annual sales ($)

Annual cost of goods sold ($)

Average inventory ($)

Average accounts receivable ($)

Average accounts payable ($)

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How it works

DIO = inventory / COGS x 365. DSO = receivables / sales x 365. DPO = payables / COGS x 365. Cash conversion cycle = DIO + DSO - DPO. Use average balances if you have them.

FAQ

About this calculator

What does the cash conversion cycle show?

How long it takes to turn money spent on inventory back into cash from sales. A shorter cycle means less cash is tied up.

Can it be negative?

Yes. If you collect and sell faster than you pay suppliers, the cycle is negative, which means suppliers are financing part of your operations.

Does it work for a service business?

Mostly the receivables and payables parts do. With no inventory, set inventory to zero.

Is anything saved?

No. The math runs in your browser and nothing you enter is sent to us.

Is this tax or financial advice?

No. It is a calculator for general information. Check the numbers against your own records, and ask an accountant before you act on them.

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Do it yourself

13-Week Cash Flow Forecast

List what you expect to collect and pay, and see your cash balance each week, the lowest point and when it happens.

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