What are Creditor Days

What are creditor days

Creditor days is a measure of how long it takes you to pay your suppliers.

How to Calculate Creditor Days on the Balance Sheet

Trade Creditors/Purchases * 365

What Does Creditor Days Show?

The results of working out creditor days can show:

Abnormally high creditor days can indicate cash flow problems within a business

Abnormally low creditor days can show that a business may not be maximising credit terms available to it to better manage their cashflow.