why is dso important 
a high dso number can indicate that the cash flow of the business is not ideal it varies by business but a number below 45 is considered good it s best to track the number over time if the number is climbing there may be something wrong in the collections department or the company may be selling to customers with less than optimal credit in any case the company s cash flow is at risk the debt collections experts at atradius suggest that tracking dso over time also creates an incentive for the payments department to stay on top of unpaid invoices 1 needless to say a small business can use its days sales outstanding number to identify and flag customers that are weighing it down by not paying promptly the bottom linein many businesses the days sales outstanding number can be a valuable indicator of the efficiency of the business and the quality of its cash flow if the number gets too high it could even disrupt the normal operations of the business causing its own outstanding payments to be delayed in any case cash delayed is cash lost to your business 