On the surface, cash flow is one of the key performance indicators businesses should be most concerned about. However, cash flow only shows part of the picture. The cash conversion cycle is a powerful metric for determining overall business health, showing how quickly a company can convert goods and services into cash.

What is Average Collection Period? In short, average collection period is the amount of time that elapses before an organization or company collects their accounts receivable (A/R) -- the payments that are owed from clients and customers. With proper average collection period monitoring and execution, organizations and businesses can help to ensure that they have enough liquid cash on hand to.

Late payments can negatively impact a business on multiple levels, from restricting growth to needing to turn to credit for operating costs. Dealing with late-paying customers is frustrating and time consuming - but it doesn’t have to be.