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Days Inventory Outstanding (DIO)

What is Days Inventory Outstanding (DIO)?

Days inventory outstanding (DIO), also sometimes referred to as Days Sales of Inventory (DSI) or Days in Inventory (DII), measures the average number of days a company holds inventory before selling it. It’s calculated by dividing the average inventory by the cost of goods sold (COGS) and then multiplying by the number of days in the period. A lower DIO indicates efficient inventory management and quicker turnover of goods.

Related terms

30-Day and 13-Week Operating Cash Burn
30-day and 13-week operating cash burn are also known as the “burn rate.” These are the rates at which a business consumes its cash reserves when it isn’t bringing in profit. 
Accounts Payable Days
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Accounts Receivable Turnover
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Annual Recurring Revenue (ARR)
Annual Recurring Revenue (ARR) is a key metric used by subscription-based businesses to track and measure their predictable, recurring revenue streams over a one-year period.