Cash-Conversion Cycle: Read It Like an Investor

Investors love businesses that turn cash quickly. The Cash-Conversion Cycle (CCC) reveals how many days pass between paying for inventory and collecting customer cash.

CCC Formula Reminder

CCC = Days Inventory Outstanding + Days Sales Outstanding – Days Payables Outstanding

Benchmark Snapshots

Sector	Healthy CCC	Warning Light
F&B	< 60 days	> 90 days
Fashion	< 90 days	> 120 days
SaaS	< 30 days	> 60 days

Three Levers to Shorten CCC

1. Receivables – Offer early-payment discounts or use invoice financing to get cash inside 48 hours.
2. Inventory – Shift slow movers to consignment or drop-shipping.
3. Payables – Negotiate net-60 terms with suppliers who value repeat orders.

If your CCC drops by even 15 days, you free up the cash equivalent of half a month’s sales—often cheaper than raising a new round.

Keywords: cash conversion cycle UAE, working-capital efficiency, invoice finance, SME cash metrics
Hashtags: #KlubAI #CashConversion #WorkingCapital #InvestorReady #FinanceBasics

Disclaimer: Metrics and sector benchmarks are approximate; use your own statements for exact calculations.