What is days sales outstanding in SAP EPM-SCP - Supply Chain Performance Management?

SAP Term: days sales outstanding

• Component: EPM-SCP

• Component Name: Supply Chain Performance Management

• Description: The length of time from when a sale is made until cash for it is received from customers.

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• Key Concepts: 
  Days Sales Outstanding (DSO) is a metric used to measure the average number of days it takes a company to collect payment after a sale has been made. It is calculated by dividing the total amount of accounts receivable by the total sales for a given period, and then multiplying that number by the number of days in the period. 
  
  How to use it: 
  The DSO metric can be used to measure the effectiveness of a company’s credit and collection policies. A low DSO indicates that customers are paying their bills quickly, while a high DSO indicates that customers are taking longer to pay their bills. 
  
  Tips & Tricks: 
  It is important to note that DSO is an average, so it may not accurately reflect the performance of individual customers. Additionally, DSO can be affected by seasonal fluctuations in sales and collections. 
  
  Related Information: 
  The EPM-SCP Supply Chain Performance Management module provides tools for analyzing and managing accounts receivable, including the ability to track DSO over time. It also provides insights into customer payment behavior and can help identify areas where improvements can be made.