Remove AR Metrics Remove Credit and Collections Remove Small Businesses
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Is It Too Late to Achieve Your End-of-Year DSO Goals?

Your Virtual Credit Manager

Chances are, there is a lot that needs to be done in terms of accounts receivable (AR) management between now and December 31st, especially if you are short of your Days Sales Outstanding (DSO) goals. Photo by B C on Unsplash ) The biggest problem—there probably are not enough days left to get everything done.

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“Must Have” Metrics for Receivables Management

Your Virtual Credit Manager

Monitoring and tracking cash is a critically important activity for most small businesses (for more on that subject, check out “ Taking the Crystal Ball out of Cash Flow Forecasting ”). Why Are Metrics Needed if You Have an AR Ledger? it just might help them collect faster and pay you sooner.

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Moving Beyond DSO

Your Virtual Credit Manager

(Photo by Carlos Muza on Unsplash ) A Framework for Choosing Suitable AR Metrics Businesses should carefully assess their specific needs, objectives, and operating context when selecting metrics for accounts receivable (AR) performance measurement. Like any metric, DSO has limitations.

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Is Your AR Performance Measuring Up?

Your Virtual Credit Manager

DSO is criticized as large variations in monthly sales can drive large changes in the metric, as can extending payment terms. For example, if collections are constant and sales are rising, DSO will increase. Nevertheless, DSO remains a popular and widely used metric by analysts. That sum is your BPDSO.