2 min read
Definition
The cash conversion cycle measures, in days, the time between a company paying for inventory and receiving cash from customers for the resulting sales. It combines stock days plus debtor days minus creditor days.
In plain terms
It's how long your cash is locked inside the business between spending and getting paid. The longer the cycle, the more working capital you need to fund it.
Why it matters for your company
Shortening the cycle — faster stock turn, quicker collections, fair supplier terms — releases cash without borrowing. See working capital management.
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Read →Funding for UK limited companies
Credicorp lends to your company, not to you personally — short-term working capital with no personal guarantee. See what your business could access.