Debtor days are 45. The invoice went out twelve days after the job finished.

Collections gets the attention because it is the only part of the cash cycle most businesses measure. The expensive days usually sit before the invoice.

By Steve 5 min read
Abstract bridge artwork for Debtor days are 45. The invoice went out twelve days after the job finished.

Almost every business that feels a cash squeeze reaches for the same lever: chase harder. Statements go out weekly, someone is given the collections file, and the owner starts making calls on a Friday afternoon. It works, up to a point. But it works on the second half of the cycle, because the second half is the only part with a number attached to it. Debtor days, DSO, however it is calculated, starts the clock when the invoice is raised. It is silent on everything that happened before. And in…

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