Supply Chain Top 25: Cash to Cash

From Chain Reaction Blog: “Cash-to-cash was one of the metrics recommended for use in the rankings, possibly replacing the inventory turns we currently use. Cash-to-cash provides a good view into supply chain throughput, or how quickly raw materials can get through supply chain operations and be converted into cash. We investigated the possibility of using it and found a few issues, the primary one being that the retailers have a huge advantage on this metric because they have almost no receivables, which is one of the components of cash-to-cash.

While we can’t use cash-to-cash for the overall ranking, it’s still a useful lens with which to examine performance, keeping in mind that supply chain performance is multi-faceted. Table 1 provides a look at the cash-to-cash performance of the Top 25 companies. It’s tempting to think of cash-to-cash as binary in its meaning, with high being bad and low being good. The reality is more nuanced. The bottom line: it’s all about tradeoffs and balance.” Supply Chain Top 25: Cash to Cash

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