The cash conversion cycle (CCC) is a metric that defines the time (in days) it takes for a company to convert its inventory and other resources into cash from sales. It is sometimes also called the Net Operating Cycle or simply Cash Cycle, CCC attempts to measure how long each dollar is tied up in the production and sales process before it gets converted into a cash receivable.

CCC takes into account how much time the company needs to sell its inventory, how much time it takes to collect the receivables, and how much time it has to pay its bills without incurring penalties and is one of several key performance indicators (KPIs) that help evaluate the efficiency of a company’s operations and management.

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