Unpacking Days Payable Outstanding

Published On:
April 15, 2022
Authored By:
Members-Only Content:

Liquidity and cash flow are critical for an organization’s ability to pay its operating expenses, especially in moments of significant disruption like a recession or global pandemic. In these moments of disruption, extending an organization’s days payable outstanding (DPO) can help free up cash for critical priorities. But extending DPO too much can strain relationships with suppliers in a way that is counterproductive for the business. In this article, APQC examines cross-industry data on DPO and highlights the key opportunities and pitfalls associated with extending DPO.