Day sales overdue (DSO) calculator
Quickly measure your payment collection efficiency and optimise cash flow.
What is Day Sales Overdue (DSO)?
Day Sales Overdue (DSO) is a key financial metric that measures the average number of days it takes a company to collect payment after a sale has been made. Understanding your DSO can provide valuable insights into the efficiency of your credit management processes and help identify potential cash flow issues.
What's your DSO?
Enter your details below and our free DSO calculator will do the work for you. Don’t worry, we won’t ask you for your details, your score will automatically come up when you have entered the figures listed below.
Enter the total amount of money owed to your company by your customers at the end of the period.
Enter the total amount of sales made on credit during the period.
Enter the number of days in the period (e.g., 30 for a month, 365 for a year).
Why should you check your DSO Score?
Improve cash flow management
A high DSO indicates that your company is taking longer to collect payments from customers, which can lead to cash flow problems. Regularly checking your DSO helps you identify issues early and take corrective action to improve cash flow.
Enhance customer relationships
By monitoring your DSO, you can identify which customers are consistently late with payments. This information allows you to address payment terms and conditions with these customers, fostering better relationships and ensuring timely payments.
Optimise credit policies
A low DSO reflects efficient credit and collections processes. By analysing your DSO, you can fine-tune your credit policies and procedures, ensuring they are both customer-friendly and effective in maintaining healthy cash flow.
Solutions for every business
Schedule your free 30 minute consultation today:
- Gain valuable insights in to our credit management consultancy and training services
- Discover how we support your business
- Find out more about the value we bring
A 30 minute call with Collect Wise could save you 50+ hours on chasing late payments. Schedule your free call today!
Common pain points leading to late payments
Inefficient invoicing processes
Delayed or incorrect invoicing can lead to payment delays. Ensuring that your invoices are accurate and sent out promptly is crucial for timely payments.
Lack of follow-up
Failure to follow up with customers regarding overdue payments can result in prolonged DSO. Implementing a consistent follow-up process can significantly reduce the time taken to collect outstanding receivables.
Poor credit assessment
Extending credit to customers without proper assessment of their creditworthiness can increase the risk of late payments. Regularly reviewing your credit assessment process can help mitigate this risk.
Weak collections strategy
An ineffective collections strategy can lead to persistent overdue payments. Developing a robust collections strategy, including clear communication and follow-up procedures, is essential for reducing DSO.
How Collect Wise can help
At Collect Wise, we specialise in credit management consultancy services designed to help businesses improve their collections performance.
Here’s how we can assist you:
In-depth credit management review
Our team will conduct a thorough review of your current credit management practices, identifying areas for improvement and providing actionable recommendations.
Customised collections strategies
We develop tailored collections strategies that align with your business objectives, ensuring efficient and effective collections processes.
Training and support
We provide training for your team on best practices in credit management and collections, equipping them with the skills needed to maintain a healthy cash flow.
Ongoing monitoring and improvement
We offer ongoing support and monitoring to ensure that your credit management processes continue to perform optimally, helping you maintain a low DSO and improve your overall financial health.
Download your Essential Guide to improving credit control collections
