Days Inventory Outstanding / DIO Formula

Days inventory outstanding (DIO) is a financial metric that measures the average number of days it takes for a company to turn its inventory into sales.

DIO = (Average Inventory / Cost of Goods Sold) x Number of Days in the Period

  • Average Inventory = (Beginning Inventory + Ending Inventory) / 2
  • Cost of Goods Sold = Total cost of producing and selling goods during the period
  • Number of Days in the Period = The number of days in the reporting period (e.g. quarter or year)

Related Resources


How to Optimize Deal Value in M&A Integrations with O2C Automation


How to Increase AR and AP Efficiency with Intelligent Document Processing


Gaining Control on Global Credit And Collections with Dashboards and Analytics


Collections Automation


How CFOs can Tie Digital Order-to-Cash Initiatives to Enterprise-wide Strategy


Autonomous Finance – The Future Of The Corporate Finance Office

Need Guidance?

Talk to Our O2C Transformation Experts

No Obligation Whatsoever


Emagia is a leading provider of AI-powered Order-to-Cash (O2C) automation platform that modernizes finance operations for midsize to large global businesses. Many global businesses and shared service centers use Emagia’s Enterprise Receivables Management System to transform to digital world-class operations in credit, invoicing and payments, receivables, collections, deductions, cash application and cash forecasting. Emagia solutions improve their customers DSO, cash flow, credit risk, operational cost, compliance and profitability.

Request a Demo