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.

flexoffers

Anita is a Chartered Accountant, turned blogger and creator of the ever popular free Go Self Employed Email Mini Course, which has been completed by hundreds of attendees all over the UK. Using her 10 years experience in accounting, tax and operations for Small Businesses, Anita is on a mission to make finance simple for the self employed, so they can stop stressing about tax & finances and focus on building profitable businesses which will give them the lifestyle they dream of.