DIO
Business & Finance abbreviation · Finance
| Stands for | Days inventory outstanding |
|---|---|
| Categories | Business & Finance |
DIO stands for Days inventory outstanding, a finance abbreviation.
Average number of days a company holds inventory before selling it, calculated as inventory divided by cost of goods sold, multiplied by days in the period. Lower DIO generally indicates efficient inventory management.
Example: Grocery chains typically run a DIO of a few weeks, while aircraft makers may hold inventory for well over a year.
Usage notes
Also called days in inventory or days sales of inventory (DSI). DIO varies enormously by industry, so comparisons are meaningful only among peers. A sudden rise can signal weak demand or obsolete stock that may need to be written down.
Related abbreviations
More finance abbreviations
- CIM – Confidential information memorandum
- CVC – Corporate venture capital
- D/E – Debt-to-equity ratio
- DCF – Discounted cash flow
- DCM – Debt capital markets
- DD – Due diligence
- DPI – Distributions to paid-in capital
- DPO – Days payable outstanding
- DSCR – Debt service coverage ratio
- DSO – Days sales outstanding
- EAR – Effective annual rate
- ECM – Equity capital markets