Days Payable Outstanding

Days Payable Outstanding (DPO) is a financial metric that measures the average number of days a company takes to pay its suppliers after receiving goods or services. It indicates how efficiently a company manages its payables and cash flow. A higher DPO suggests the company is stretching out payments to conserve cash, while a lower DPO means it pays suppliers more quickly. This metric helps assess a company's financial health and operational efficiency, balancing good supplier relationships with effective cash management.