Days Sales Of Inventory (DSI)

Definition

A financial measure of a company's performance that gives investors an idea of how long it takes a company to turn its inventory (including goods that are work in progress, if applicable) into sales. Also known as days inventory outstanding (DIO).

Formula

Use Case / Interpretation

Generally, the lower (shorter) the DSI the better, but it is important to note that the average DSI varies from one industry to another.

Tags

idea, inventory, performance