Companies take 67 days to turn cash spent into cash collected.
Allianz Trade releases its annual Days Sales Outstanding (DSO)[1] & Cash Conversion Cycle (CCC)[2] report today, which focuses on how long it takes corporates to turn a unit of cash spent on operations into cash collected from sales. According to the world leader in trade credit insurance, the global CCC rose again in 2025 (67 days) and appears to have settled at a structurally high plateau. The real driver is inventories, with companies moving away from "just-in-time" efficiency toward "just-in-case" resilience.
More inventories increase resilience but weigh on cash realization
The global CCC rose by a moderate half a day in 2025. It now stands at 67 days of turnover, some +3 days above its 10-year average and close to its 2023 high (68 days). This trend shows no sign of easing, and is primarily driven by companies’ efforts to enhance resilience through larger inventories.
“Days Inventory Outstanding (DIO)[3] now explains almost 80% of the CCC level. This reflects a fundamental change in corporates’ behavior: they are moving away from "just-in-time" efficiency toward "just-in-case" resilience. By building larger inventories, companies tie up more capital in stock that is not expected to be converted into cash quickly, in exchange for greater supply chain security and flexibility against geopolitical uncertainty, supply chain disruptions, and trade fragmentation. In other words, supply chains are no longer optimized only for cost. They are increasingly designed for security, resilience, and optionality,” explains Maxime Lemerle, Lead Analyst for insolvency research at Allianz Trade.
According to Allianz Trade, global DIO reached 53 days in 2025, quite stable compared to 2024, but well above the pre-pandemic average (48 days). In this context, DSO is not adding extra pressure on corporates’ cashflow: global payment terms increased slightly to 56.5 days (+0.3 day) last year, remaining stable at this level since 2022, and still -3 days compared to the pre-pandemic norm.
Asia carries the longest cash conversion cycle
CCC in Asia extended by 1.2 days to 70 days in 2025, signalling the longest of all regions and a record +5 days above the pre-2020 average. Unlike other regions, the rise was driven not by inventory but by a sharp cut in Days Payable Outstanding (-1.4 days to 44 days), as firms paid suppliers faster. DSO held steady at 59 days — though still the longest customer payment terms globally — while DIO remained at approximately 55 days.
Across sectors, diverging trends prolong the usual wide discrepancies. In Asia, the largest increase in CCC were noted in metals (+6 days), pharmaceuticals (+5 days), while software and IT services, paper, automotive manufacturers and agrifood each logged an increase of 4 days. Conversely, sectors that saw the most significant decrease in CCC are commodities (-13 days), transport equipment (-9 days) and constructions (-6 days). For 2026, the regional CCC is forecast to rise further to 72 days (+2 days), driven by strategic inventory rebuilding and geopolitical disruption compounding on top of the pre-existing payment-terms constraint, positioning Asia on the watch list for corporate cash-flow stress.
What to expect for 2026?
Allianz Trade expects a contained rise in CCC in 2026. First, the sectors most affected by the US-Iran conflict have limited room to accommodate a further rise in DIO before financing needs enter distress territory. Second, the shock should be partly offset by continued private-sector spending on AI infrastructure and data centers, which supports computers & telecoms and software & IT, keeping a meaningful share of the economy on a compressing or at worst flat trajectory.
“On these assumptions, measures to reassess energy security, strategic inventories and supply chain resilience, together with the direct fallout of the conflict, should push global DIO up by around +2 days. We estimate that each additional day of DIO translates into +1.16 days of CCC globally. This is quite far from what was witnessed after the 2022 shock, when CCC rose by +5 days,” concludes Mr Lemerle.
[1] The DSO measures the time taken to collect cash from customers.
[2] The CCC measures how long it takes for a unit of cash spent on operations to be converted into cash collected from sales.
[3] The DIO measures how long cash is locked in stock.
