Cash Conversion Cycle
Where is your
cash hiding?
Profitable on paper but always short of cash? It’s usually stuck in receivables and inventory. See exactly how many days — and how much money.
Your working-capital days
Rough averages are fine.
Receivable days how long customers take to pay (DSO)
Inventory days stock sitting before sale (DIO)
Payable days how long you take to pay suppliers (DPO)
Annual revenue to value the trapped cash
Your cash is out
Suppliers fund
You fund (CCC)
Every rupee is tied up for
—
days before it comes back as cash
—
roughly the cash locked in working capital
Receivables
—
Inventory
—
Payables
—
—
CCC = Receivable days + Inventory days − Payable days. Trapped cash is indicative (CCC ÷ 365 × annual revenue). Shorten the cycle — collect faster, hold less stock, negotiate supplier terms — and cash appears without new sales.
Free the cash you already earned.
CA Vipin Gupta builds Clarity, Control & Continuity into MSME finances. Follow for weekly founder-finance breakdowns, or connect to talk about yours.
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For education only. Indicative, not financial advice.
For education only. Indicative, not financial advice.