Top member reports
Company Report
Last edited 3 years ago
PerformanceCommunity EngagementCommunity Endorsement
Performance (38m)
-23.0% pa
Followed by
27
Straws
Sort by:
Recent
Content is delayed by one month. Upgrade your membership to unlock all content. Click for membership options.
#Cash Conversion
stale
Added 3 years ago

@Elpaso96, in answer to your recent question “How quickly can they (Zoono) collect cash after invoicing”, I’ve put together a breakdown of Zoono’s cash conversion cycle (CCC) over the past 5 years (see attached). 

Clearly, the CCC has been increasing over time, however I don’t believe the main cause is due to delayed receipts from customers.  This can be seen in the DSO values which show that on average, Zoono’s customers are making payment within a couple of months of invoicing.  That’s a pretty good collection period for any business.

Where I think the problem lies for Zoono is the cash tied up in its inventory, as illustrated by the high DIO values.  One reason for such a high commitment to inventory may be due to Zoono looking to promote its reliability of supply through having sufficient stock on hand as it develops a number of new markets in quick succession.  Once those customers become more ‘sticky’, Zoono could look to improve its inventory management practices (ie. better forecasting, automation, pricing strategies).

View Attachment