How To Calculate DPO in BQE CORE | Arithmix

Learn how to calculate DPO (Days Payable Outstanding) in BQE CORE with our step-by-step guide. Improve your financial management skills and gain insights into your business's cash flow with this essential tool.

Calculating DPO in BQE CORE is a simple process that can provide valuable insights into your business's financial health. But before we dive into the steps for calculating DPO, let's first understand what DPO is and when it's valuable to calculate.

What Is DPO?

DPO stands for Days Payable Outstanding. It is a financial metric that measures the average number of days it takes for a company to pay its suppliers and vendors for goods and services received. In other words, DPO measures the efficiency of a company's accounts payable process.

Calculating DPO involves dividing the total accounts payable by the cost of goods sold (COGS) per day. The resulting number represents the average number of days it takes for a company to pay its suppliers.

When Is It Valuable To Calculate DPO?

Calculating DPO can be valuable for businesses in several ways. For example, it can help businesses identify inefficiencies in their accounts payable process and take steps to improve it. A high DPO can indicate that a business is taking too long to pay its suppliers, which can strain relationships and lead to late fees and penalties.

On the other hand, a low DPO can indicate that a business is paying its suppliers too quickly, which can negatively impact cash flow. By calculating DPO, businesses can find the optimal balance between paying suppliers promptly and maintaining healthy cash flow.

Additionally, DPO can be a useful metric for investors and creditors who want to assess a company's financial health. A high DPO can indicate that a company is managing its cash flow well, while a low DPO can be a red flag for potential financial difficulties.

Now that we understand what DPO is and why it's valuable to calculate, let's move on to the steps for calculating DPO in BQE CORE.

How Do You Calculate DPO in BQE CORE

BQE CORE itself isn’t naturally geared towards letting you calculate complex metrics like DPO. As an alternative, teams typically use products like Arithmix to import data from BQE CORE 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 BQE CORE, combine it with data from other systems, and create calculations like DPO.

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.