The Days Sales Outstanding (DSO) calculation is a metric used to measure the average number of days it takes for a business to collect payment from their customers. It’s an important tool that can help companies identify current and potential problems with their accounts receivables process, and determine how well they’re managing customer credit. DSO helps businesses understand areas where they may need to take action, such as tightening credit terms, streamlining billing procedures or providing customers incentives to pay more quickly. By monitoring DSO over time, businesses can use this data to make strategic decisions around cash flow, budgeting and planning for future growth.