Ecolab Inc (ECL)

Payables turnover

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Cost of revenue	US$ in thousands	13,523,500	12,764,100	11,239,000	10,475,700	13,136,500
Payables	US$ in thousands	1,566,300	1,728,200	1,384,200	1,160,600	1,075,300
Payables turnover		8.63	7.39	8.12	9.03	12.22

December 31, 2023 calculation

Payables turnover = Cost of revenue ÷ Payables
= $13,523,500K ÷ $1,566,300K
= 8.63

Ecolab, Inc.'s payables turnover has been relatively stable over the past five years, ranging from 5.11 to 6.79. The payables turnover ratio indicates how efficiently a company is managing its accounts payable by measuring how many times a company pays off its average accounts payable balance over a period.

A higher payables turnover ratio suggests that the company is paying off its suppliers more quickly, which may indicate good liquidity management and strong supplier relationships. In Ecolab's case, the decreasing trend in payables turnover from 2019 to 2022 may indicate that the company was taking more time to pay its suppliers during those years.

However, the slight increase in payables turnover in 2023 to 5.84 suggests that Ecolab may have worked on improving its payables management by paying off its suppliers at a slightly quicker pace.

Overall, a payables turnover ratio in the range of 5.11 to 6.79 indicates that Ecolab is effectively managing its accounts payable and striking a balance between holding onto cash and maintaining good supplier relationships.