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Cash-to-cash cycle time looks at the number of days of working capital an organization has tied up in managing its supply chain. Another way to think about this measure is the cash conversion cycle time, measuring the amount of time it takes for a company to convert resources like inventory or investments in production into cash from sales. The faster the cash-to-cash cycle, the fewer days an organization’s cash is unavailable for use. If cash isn’t coming in quickly enough or is tied up in excess inventory, a company might struggle to pay its debt, make its payroll, or invest in its future.

For this measure, since lower is better, top performers are defined as organizations at or below the 25th percentile, and bottom performers are organizations at or above the 75th percentile. Top performers have a cash-to-cash cycle time of slightly more than five weeks (38 days), whereas bottom performers have a cycle time of over two months (65 days) . Bottom performers on this measure will be more likely to see cash flow problems, which is not an ideal situation in an environment where credit may be harder (or more expensive) to come by.