Chipotle Mexican Grill Inc (CMG)

Days of sales outstanding (DSO)

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Receivables turnover		58.59	55.84	38.97	15.45	51.61
DSO	days	6.23	6.54	9.37	23.62	7.07

December 31, 2023 calculation

DSO = 365 ÷ Receivables turnover
= 365 ÷ 58.59
= 6.23

Based on the data provided for Chipotle Mexican Grill's days of sales outstanding (DSO) from 2019 to 2023, the trend indicates fluctuations in collection efficiency over the years.

In 2019, the DSO stood at 7.07 days, representing a reasonable time frame for the company to collect its accounts receivable. However, this metric significantly increased to 23.62 days in 2020, suggesting a potential issue with timely collections.

The following year, in 2021, there was a decrease in DSO to 9.37 days, indicating an improvement in the company's collection practices. This trend continued into 2022, with the DSO further decreasing to 6.54 days, reflecting enhanced efficiency in collecting payments from customers.

Finally, in 2023, the DSO decreased slightly to 6.23 days, demonstrating that Chipotle Mexican Grill has been maintaining its effective accounts receivable management practices. Overall, the decreasing trend in DSO over the years signals a positive outlook for the company's ability to convert its credit sales into cash efficiently and effectively.