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Increase the Liquidity of Your Receivables Portfolio

Your Virtual Credit Manager

Turning your inventory over faster and your payables slower will add cash to your balance sheet, as will raising capital by selling shares in your company or getting a loan or line of credit. Here are the KPIs you will need at a minimum: Days Sales Outstanding (DSO) - This metric tells you how fast you are converting your sales into cash.

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Is Your AR Performance Measuring Up?

Your Virtual Credit Manager

DSO is criticized as large variations in monthly sales can drive large changes in the metric, as can extending payment terms. For example, if collections are constant and sales are rising, DSO will increase. Nevertheless, DSO remains a popular and widely used metric by analysts. Learn More About Consulting The Takeaway.