Most late payment happens before the invoice goes out

Days sales outstanding is measured from the invoice date, which means the part of the delay you control most is the part nobody is counting.

By Steve 5 min read
Abstract bridge artwork for Most late payment happens before the invoice goes out

A business notices cash is tight despite a healthy order book, pulls the aged debtors report, and finds a column of overdue balances. The response is almost always collections: chase harder, escalate earlier, perhaps bring in someone whose job is the phone calls. Sometimes it works. Often it produces a one-off improvement that decays within two quarters, and the underlying tightness returns. The reason is structural. Days sales outstanding is measured from the invoice date. Everything that happens between finishing the work and raising the invoice is, by construction, invisible…

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