DSO = unpaid receivables ÷ credit sales in the period × days in the period. With €12,000 unpaid at the end of a quarter and €30,000 invoiced during it, DSO is 12,000 ÷ 30,000 × 90 = 36 days: on average, customers take 36 days to pay. Compare it with your payment terms — if you give 30 days, customers pay about 6 days late on average.
Calculate your DSO
How to read the result
- Below or close to your terms: customers pay roughly on time.
- Well above your terms: money arrives later than agreed; look at reminders before the due date and consistent follow-up.
- Rising over time: compare the same period each quarter rather than single months, because one large invoice can move the number.
Getting the inputs right
- Use only credit sales — invoices paid later — not cash or card payments taken at the time of sale.
- Take receivables at the end of the same period, and use the same currency for both figures.
- DSO is an average: one very late customer can hide behind many punctual ones, so also check which receivables are overdue.
Lowering DSO
Clear payment terms, a reminder a few days before the due date and a steady follow-up afterwards are the most direct levers — see how to reduce late payments. RemindCash sends those reminders automatically and shows which receivables are upcoming, overdue, partly paid or paid.