Back to Tools

Days Sales Outstanding (DSO)

Determine how long it takes to collect payment after a sale on average, revealing the effectiveness of your credit and collections process.

DSO Results

Days Sales Outstanding:
Average Daily Sales:

DSO Formula

DSO = (Accounts Receivable ÷ Total Credit Sales) × Number of Days

Accounts Receivable

The total amount owed by customers for goods or services sold on credit.

Total Credit Sales

The total sales made on credit during the specified time period.

Number of Days

The time period being analyzed (typically 365 days for annual DSO).

Industry Benchmarks

< 30
Excellent
Very efficient collection
30-45
Good
Industry standard
46-60
Fair
Needs improvement
> 60
Poor
Review collection process

Tips to Improve DSO

Collection Strategies

  • Send invoices immediately upon delivery
  • Implement automated payment reminders
  • Offer early payment discounts
  • Conduct credit checks on new customers

Process Improvements

  • Streamline invoicing processes
  • Set clear payment terms
  • Monitor aging reports regularly
  • Train staff on collection procedures

Get Results of Days Sales Outstanding (DSO) via Email

Save your calculations and get detailed breakdowns

We respect your privacy. No spam, unsubscribe anytime.

v1.0.0.657324