DPO (Days Payable Outstanding)

Intermediate 💰 Finance / Accounting

Definition

How long a company takes to pay suppliers, basically measuring how shamelessly they exploit vendor financing.

Example Usage

Our DPO is 120 days because we've trained our suppliers to forget about payment until we remember.

Origin

Working capital management terminology

Fun Fact

Large retailers like Walmart are famous for DPOs exceeding 90 days, which suppliers grudgingly accept

Source: Working capital and cash management terminology

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