cash conversion cycle

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Cash conversion cycle

The length of time between a firm's purchase of inventory and the receipt of cash from accounts receivable.

Cash Conversion Cycle

The time between an expenditure of money to make a product and the collection of accounts receivable from the sale of that product. Obviously, a shorter cash conversion cycle is preferable. A longer cash conversion cycle may indicate a current or potential problem with cash flow.

cash conversion cycle

The time required for a business to turn purchases into cash receipts from customers. A short cycle allows a business to quickly acquire cash that can be used for additional purchases or debt repayment.
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Highly-leveraged businesses need to focus on generating cash to service the debt and their financial executives needed to understand the drivers of cash flow--expense control, short cash to cash cycles and stingy reinvestment practices.
There's always room to improve service levels, achieve greater inventory turns, reduce logistics costs, improve order to cash cycles and improve margins.
One of the company's business groups deals with long cash cycles, making cash management and conservation measures critical to the company's success.
Telcordia understands these challenges and it is driving purpose-built solutions to help customers achieve their business goals with an aim to reduce costs, accelerate time to market, and improve order to cash cycles.
Not only does this platform enable companies to handle the increasing volume and complexity of transactions in the Midwest Market, it delivers quicker, more efficient revenue and cash cycles in addition to the back office efficiency and accuracy that market participants need to do business profitably in these kinds of evolving wholesale markets.