How To Calculate Average Days Sales Outstanding in SAP Business One | Arithmix

Calculating average days sales outstanding (DSO) is an important metric for any business. It helps you understand how long it takes for your customers to pay their invoices, which can be a key factor in managing cash flow and predicting future revenue. While there are many ways to calculate DSO, SAP Business One offers a straightforward method that can be easily customized to fit your needs.

What Is Average Days Sales Outstanding?

DSO is a measure of the average number of days it takes for your customers to pay their invoices. It is calculated by dividing the total accounts receivable by the average daily sales. Essentially, it tells you how long it takes for your customers to pay you after you have made a sale. This metric is important because it can help you identify potential cash flow issues and take steps to address them before they become a problem.

When Is It Valuable To Calculate Average Days Sales Outstanding?

Calculating DSO is valuable for any business that extends credit to its customers. It can be particularly useful for businesses that have a high volume of sales and a large number of customers. By tracking DSO over time, you can identify trends and make adjustments to your credit policies or collections processes to improve cash flow. Additionally, DSO can be a useful metric for investors and lenders who are evaluating your business's financial health.

Overall, calculating DSO is a simple yet powerful way to gain insight into your business's cash flow and customer payment behavior. By using SAP Business One's customizable DSO calculation method, you can easily track this metric over time and make informed decisions to improve your business's financial health.

How Do You Calculate Average Days Sales Outstanding in SAP Business One

SAP Business One itself isn’t naturally geared towards letting you calculate complex metrics like Average Days Sales Outstanding. As an alternative, teams typically use products like Arithmix to import data from SAP Business One and build out dashboards.

What is Arithmix?

Arithmix is the next generation spreadsheet - a collaborative, web-based platform for working with numbers that’s powerful yet easy to use. With Arithmix you can import data from systems like SAP Business One, combine it with data from other systems, and create calculations like Average Days Sales Outstanding.

In Arithmix, data is organized into Tables and referenced by name, not by cell location like a spreadsheet, simplifying calculation creation. Data and calculations can be shared with others and re-used like building blocks, vastly streamlining analysis, model building, and reporting in a highly scalable and easy to maintain platform. Data can be edited, categorized (by dimensions) and freely pivoted. Calculations are automatically copied across a dimension - eliminating copy and paste of formulas.

Arithmix is fully collaborative, giving your entire team access to your numbers and the ability to work together seamlessly.

Calculating Average Days Sales Outstanding in Arithmix

Calculating metrics like Average Days Sales Outstanding is simple in Arithmix. Once you've created your free account, you’ll be able to import your SAP Business One data, and use it to create natural language formulas for metrics like Average Days Sales Outstanding.

Arithmix is designed to give you the power to build any calculations you want on top of your SAP Business One data, while also being easy to use and collaborate on. You can share your dashboards with users inside and outside of your organisation, making it easy to empower your whole team.