What is a good cash conversion cycle?

It depends on the business, but lower is usually better if stock levels and customer service stay healthy.

Why does the calculator need payables too?

Payables delay when cash leaves your business, so they are part of the full cycle.

Does this work for service businesses?

Not usually. This metric matters most for inventory-led businesses.

Cash Conversion Cycle Calculator

See how many days cash stays tied up between stock, receivables, and supplier payments, and how much working cash you could release.

IndustryUseful for food and drink businesses with tickets, bookings, or covers.Average stock on handAverage food, drink, and packaging inventory value during the period.Cost of goods soldTotal ingredient and packaging cost used in the same period.Accounts receivableOutstanding event, catering, or account receivables still unpaid.Credit salesSales billed to accounts or events during the period. Use zero if you collect everything at the time of sale.Accounts payableBills you owe suppliers right now.Supplier purchasesInventory purchases from suppliers during the same period. Use zero if there were no purchases in this period.Days in periodUse the same period across stock, receivables, payables, and purchases.Target cash cycle in daysThe working-capital cycle you want to move toward.

Result

DIO

17.5 days

DSO

0.5 days

DPO

7.5 days

Cash conversion cycle

10.5 days

Extra cash required at target

$100,333

Planning guide

Compare your cash conversion cycle to the planning range we use for restaurant or cafe.

Benchmark range: 5 days to 20 daysYour result: 11 days

Food businesses usually need a short cash cycle because stock turns quickly and supplier timing matters.

Source: QuickBooks, Cash Conversion Cycle guide (April 2026)

What this means

Cash cycle looks workable

Your working-capital cycle is not above the planning range we use for restaurant or cafe

Your current cycle is about 10.5 days: 17.5 days in stock, 0.5 days in receivables, and 7.5 days of supplier float.

Your target is longer than your current cycle. With a similar stock, receivable, and payable mix, that would tie up about $100,333 more working cash.

Planning guide

Planning ranges used in this cash conversion cycle calculator

This calculator uses planning ranges because cash conversion cycle is an operating discipline measure, not a one-size-fits-all public benchmark.

It is limited to inventory-led businesses where stock, supplier timing, and receivables all materially shape cash flow.

IndustryUseful for food and drink businesses with tickets, bookings, or covers.

Restaurant or cafe

Useful for food and drink businesses with tickets, bookings, or covers.

Benchmark range: 5 days to 20 days

Food businesses usually need a short cash cycle because stock turns quickly and supplier timing matters.

Source: QuickBooks, Cash Conversion Cycle guide (April 2026)

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Calculator guide

How to use this cash conversion cycle calculator

This calculator combines DIO, DSO, and DPO into one working-capital number. It helps inventory-led businesses see how long cash stays locked in the operating cycle.

What the cash conversion cycle shows

The cycle starts when cash goes into stock or supplier purchases and ends when that cash comes back through sales collections.

A shorter cycle usually means less working cash is trapped in the business.

How to improve the cycle

The three main levers are stock days, collection days, and supplier timing.

If the cycle is too long, improving just one part can still release meaningful cash.