Interpret the cash conversion cycle as a treasury liquidity signal.
A stronger sales quarter can still lengthen the time between cash out and cash back in. Three Clocks Drive The Cycle DIO measures how long cash sits in inventory, DSO measures how long it sits in receivables, and DPO measures how long supplier credit funds the gap. Together, they show the operating timing behind liquidity. Growth Creates A Funding Need When sales grow with longer terms, more stock, or faster supplier payments, the business needs more cash to support each dollar of revenue. Treasury should surface that funding need before it becomes a surprise drawdown. Diagnosis Beats Blame The cycle…
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