DIO — Days Inventory Outstanding
Definition: Average number of days inventory sits before being sold. Lower DIO means tighter working capital and less risk of obsolescence.
Example
In board meetings, you'll often hear something like: "Let's pull the latest DIO numbers before we make a call" — shorthand for days inventory outstanding.
When you'll hear it
DIO shows up most often in board meetings, quarterly business reviews, and strategy off-sites. When someone uses it, they're usually referring to days inventory outstanding — and they expect the room to already know what that means.
FAQs
What does DIO stand for?
DIO stands for Days Inventory Outstanding.
What does DIO mean in business and finance?
Average number of days inventory sits before being sold. Lower DIO means tighter working capital and less risk of obsolescence.
Where will I hear DIO used at work?
DIO comes up most often in board meetings, quarterly business reviews, and strategy off-sites. It's used as shorthand for days inventory outstanding, so people assume you already know the term.