Financial-statement example
For a 90-day quarter with sales £120,000, COGS £75,000, average inventory £25,000, average A/R £18,000, and average A/P £12,000:
DIO = 30.0 days, DSO = 13.5 days, DPO = 14.4 days, so CCC = 29.1 days.
Cash Conversion Cycle (CCC) Calculator
Calculate how many days cash is tied up between buying inventory, collecting from customers, and paying suppliers.
Inputs
CCC = DIO + DSO − DPO
Inventory days plus collection days minus supplier payment days.
Mode: Statements
Currency: £
Period Days: —
Period and statement totals
Optional date range instead
Use dates only when your reporting period is not a standard 365, 90, or 30 days.
Inventory, receivables, and payables balances
Direct DIO, DSO, DPO, and CCC days
Enter any three values. The calculator solves the missing value using CCC = DIO + DSO − DPO.
Optional annual amount for cash impact
Enter annual COGS first when you want a cost-based working capital estimate. Annual sales is used only when annual COGS is blank.
Results
Cash conversion cycle
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DIO (days inventory outstanding)
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DSO (days sales outstanding)
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DPO (days payables outstanding)
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Inventory Turnover
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Receivables Turnover
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Payables Turnover
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Period Days
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Avg Inventory Used
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Avg A/R Used
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Avg A/P Used
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Interpretation
Enter values to see what the CCC means and which component is driving it.
Cash impact per CCC day
Add statement amounts or optional annual COGS/sales to estimate working capital tied up per day.
Improve CCC what-if
Adjust targets to see how faster inventory turnover, faster collections, or longer supplier terms change CCC.
Reduce DIO through faster inventory turnover.
Reduce DSO through faster collections.
Increase DPO carefully through supplier terms.
Calculate first to set the what-if baseline.
DIO
DSO
DPO
CCC
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How to use this CCC calculator
- Choose Use financial statement amounts if you have sales, COGS, inventory, receivables, and payables, or choose Use DIO/DSO/DPO days if you already know the component days.
- Choose Annual 365 days, Quarter 90 days, Month 30 days, Custom days, or the optional date range control.
- In statement mode, enter sales, COGS, and either average balances or beginning and ending balances. In days mode, enter any three of DIO, DSO, DPO, and CCC.
- Review the CCC, interpretation, cash impact per CCC day, and what-if result.
Formulas
CCC = DIO + DSO − DPO
- DIO = (Average Inventory ÷ COGS) × Period Days
- DSO = (Average Accounts Receivable ÷ Sales) × Period Days
- DPO = (Average Accounts Payable ÷ COGS) × Period Days
- Average balance = (Beginning Balance + Ending Balance) ÷ 2
Turnovers are also shown in statement mode: Inventory = COGS ÷ Average Inventory; Receivables = Sales ÷ Average A/R; Payables = COGS ÷ Average A/P.
Understanding the Cash Conversion Cycle (CCC)
The Cash Conversion Cycle (CCC) measures how long operating cash is tied up in inventory and receivables after considering supplier payment timing. DIO and DSO increase CCC because inventory and receivables use cash. DPO reduces CCC because supplier terms delay cash outflow.
Interpreting the number
A positive CCC means cash is tied up for that many days before it returns through collections. A near-zero CCC means the business is roughly matching collection timing with supplier payments. A negative CCC means customers pay before suppliers are paid, which can improve liquidity if the model is sustainable.
Data quality checklist
- Use sales, COGS, balances, and period days from the same reporting period.
- Use credit sales for DSO when available, especially if cash sales are material.
- Use beginning and ending balances for a quick average, or monthly averages for seasonal businesses.
- For DPO, use purchases instead of COGS when purchase data better matches trade payables.
Worked Examples And Benchmarks
Direct days example
If you already know DIO is 42 days, DSO is 28 days, and DPO is 35 days:
CCC = 42 + 28 − 35 = 35 days. Inventory is the largest component, so faster stock turnover would be the first improvement area to test.
Negative CCC example
A marketplace or fast-turn retailer might have DIO of 10 days, DSO of 2 days, and DPO of 45 days:
CCC = 10 + 2 − 45 = −33 days. Customers fund the cycle before suppliers are paid, but supplier terms and service quality still need monitoring.
Benchmarks vary widely by industry. Compare CCC against similar business models and against the same company over time.
FAQ
Is a lower cash conversion cycle better?
Usually, yes. A lower CCC means less cash is tied up in inventory and receivables before suppliers are paid. Compare it with margins, growth, service levels, and supplier risk rather than treating the lowest number as automatically best.
What is a good CCC by industry?
There is no universal good CCC. Grocery, marketplace, subscription, and fast-turn retail models can be near zero or negative, while manufacturing, wholesale, seasonal, and project businesses often run longer cycles. Compare companies with similar inventory, credit, and supplier terms.
Can CCC be negative?
Yes. A negative CCC means the business collects from customers before it pays suppliers. That can be powerful, but it depends on stable demand, reliable fulfillment, and supplier terms that are sustainable.
Should I use revenue or credit sales for DSO?
Use credit sales when you have them because DSO measures receivables created by sales on credit. If you use total revenue for a business with many cash sales, DSO can look artificially low.
Should I use COGS or purchases for DPO?
This calculator uses COGS for DPO because it is commonly available and aligns with many quick CCC calculations. If your payables are tied to inventory purchases and you know purchases for the period, purchases can be a better denominator.
Does CCC apply to software or service businesses?
CCC is most useful for businesses with inventory, receivables, and supplier payables. For software or service businesses with little inventory, DIO is often zero or not meaningful, so DSO, deferred revenue, billing terms, and cash burn may be more useful.
Should I use 365 or 90 days?
Use 365 days for annual statements, 90 days for a quarter, and 30 days for a month. The period days should match the sales, COGS, receivables, inventory, and payables data you enter.
What counts as average balances?
A common approach is beginning balance plus ending balance divided by two. If the business is seasonal or fast-changing, monthly or weekly averages can be more representative.
Do you upload my inputs?
No. The calculator runs in your browser and does not upload your financial inputs.
Formula Sources And Assumptions
Last updated: June 9, 2026. Editorial note: Starlight Tools finance calculator formulas are checked against published finance references and kept separate from advertising and related-tool navigation.
- Investopedia: Cash Conversion Cycle for the CCC formula and interpretation of DIO, DSO, and DPO.
- Investopedia: Days Sales of Inventory for inventory days and inventory turnover context.
- Investopedia: Days Sales Outstanding for DSO and the credit-sales limitation.
- Investopedia: Days Payable Outstanding for DPO period-day and interpretation guidance.
Assumptions: statement mode uses COGS for DIO and DPO, sales for DSO, and the selected period days for all three components. Cash impact per CCC day uses annualized COGS when available, otherwise annualized sales. Informational only; not financial advice.