← Back to glossary Category: Financiar · Acronym: DPO DPO (Days Payable Outstanding) Quick answer: Average number of days from supplier invoice receipt to actual payment. Key takeawaysHigh DSO + low DPO = cash trapped (customers pay you late, you pay suppliers fast)Low DSO + high DPO = cash surplus (customers pay fast, suppliers wait) Definition DPO (Days Payable Outstanding) = (Trade payables / Operating costs) × Days. Measures how many days you hold a supplier invoice before paying. DPO vs DSO — the cash balance High DSO + low DPO = cash trapped (customers pay you late, you pay suppliers fast) Low DSO + high DPO = cash surplus (customers pay fast, suppliers wait) Cash Conversion Cycle = DSO + DIO (days inventory) − DPO Pitfalls DPO „stretched” by abusive delays → damaged relationships, lost cash discounts, supply blocks Artificially low DPO from broken processes → missed discounts, duplicate payments Frequently askedWhat is a „good” DPO?Equal to or slightly above contractual terms. DPO much above contract = abusive. DPO below contract = you lose cash discounts. Where Azuvio fitsSoftware OMS Related termsProcure-to-Pay (P2P) — The end-to-end procurement cycle: request → order → receipt → invoice → payment → reconciliation.DSO (Days Sales Outstanding) — Average number of days from invoice issue to cash collection. Key cash-flow indicator. Last updated: 2026-07-17