What Is Days Sales Outstanding (DSO)?

Days sales outstanding (DSO) is the average number of days it takes you to get paid after you send an invoice. The formula is: DSO = (accounts receivable / total invoiced sales for the period) x number of days in the period.

Freelancers and small businesses use DSO to see whether getting paid is speeding up or slowing down. Compare it with your payment terms. If you invoice on net 30 and your DSO is 45, clients are paying about two weeks late on average, and that gap is cash you have earned but can't spend.

Work it out monthly or quarterly using the receivables balance at the end of the period. A rising DSO is an early warning. Look at the aging report to find which clients are behind, then tighten terms, ask for deposits or send reminders sooner. DSO is an average, so one large overdue invoice can move it a lot in a small business.

SolidInvoice tracks which invoices are paid and outstanding, and the CSV export gives you the numbers for the calculation. On Pro and Business plans, automated payment reminders help bring DSO down.