Metrics & KPIsDays Sales Outstanding (DSO)
Definition
A measure of the average number of days that a company takes to collect revenue after a sale has been made.
Formula
(accounts receivable / total credit sales) x number of days
Use Case / Interpretation
A low DSO number means that it takes a company fewer days to collect its accounts receivable. A high DSO number shows that a company is selling its product to customers on credit and taking longer to collect money.
Tags
Sales, revenue