E-commerce Cash Flow, Runway & Cash Conversion Cycle Calculator
See your monthly burn or surplus, how long your cash lasts, and how much money is tied up in inventory.
How the Cash Flow & Runway Calculator Works
Profitable stores still run out of cash. Inventory has to be paid for before it sells, ad spend leaves your account every day, and fixed costs do not wait for sales. Two numbers tell you how safe you are: how many months of cash you have, and how many days your money is locked in the sales cycle.
Enter your cash balance, fixed operating expenses, ad spend, and the monthly gross profit from sales. The tool shows your monthly net burn or surplus and, if you are burning cash, your runway in months. Add your inventory, sales, and payable days to see the cash conversion cycle, and add your monthly cost of goods to estimate the working capital tied up in that cycle. The card is green for a surplus, blue for a runway of 6 months or more, and red for a shorter runway.
Key Formulas Behind This Tool
- Total Monthly Outflow: Fixed Operating Expenses + Ad Spend
- Monthly Net Burn / Surplus: Monthly Gross Profit - Fixed Operating Expenses - Ad Spend
- Cash Runway (months): Starting Cash Balance / Monthly Net Burn (only when burning cash)
- Cash Conversion Cycle (days): DIO + DSO - DPO
- Working Capital Tied Up: Cash Conversion Cycle x (Monthly Cost of Goods Sold / 30)
Frequently Asked Questions (FAQ)
What is cash runway?
Runway is how many months you can keep operating before your cash runs out, assuming your current monthly burn stays the same. It equals your cash balance divided by your monthly net burn. If you are not burning cash, there is no runway limit.
What is the cash conversion cycle?
It measures how many days your cash is tied up between paying for inventory and collecting from customers. It equals days inventory outstanding plus days sales outstanding minus days payable outstanding. A shorter or negative cycle means cash returns to you faster.
How do I find DIO, DSO, and DPO?
DIO is the average days a unit sits in stock before it sells. DSO is the average days between a sale and the money reaching your bank, which is often just a few days for card payments. DPO is the average days you take to pay suppliers after receiving goods.
What does working capital tied up mean here?
It estimates the cash locked in the cycle by multiplying the cash conversion cycle in days by your average daily cost of goods sold. It needs the optional monthly cost of goods field. This is a simplified estimate meant for planning.
What should I use as monthly net gross profit?
Use revenue minus product cost, shipping, and payment fees for the month, before fixed expenses and ad spend. The calculator subtracts fixed operating expenses and ad spend separately.