In short
- Order-to-cash (O2C) spans order, fulfilment, invoicing, collections, and cash application.
- It ends when payment is collected and recorded in the ledger.
- Collections and cash application are the steps most often slowed by manual work.
- Speeding up the back end of O2C directly lowers DSO.
Order-to-cash, defined
Order-to-cash (O2C) is the full lifecycle of a customer transaction on the revenue side: capturing the order, fulfilling it, issuing the invoice, collecting payment, and applying that cash to the right invoices.
It is the revenue counterpart to procure-to-pay, and how efficiently it runs determines how fast revenue becomes usable cash.
The order-to-cash steps
A typical O2C flow is: order management, credit management, order fulfilment, invoicing, collections and dunning, and finally cash application and reporting.
The front end (ordering, fulfilment) is usually well-systemized; the back end (collections and reconciliation) is where delay and manual effort concentrate.
Automating order-to-cash
Because the back of O2C is the slow part, that’s where automation pays off most. An autonomous agent that runs collections across channels and applies cash automatically removes the delays that inflate DSO.
See accounts receivable automation for where to start.
Frequently asked questions
What is the difference between order-to-cash and accounts receivable?
Accounts receivable is one stage within order-to-cash. O2C is the whole revenue process from order to payment; AR is specifically the open balances and their collection.
See Welldun work on your ledger
Welldun chases overdue invoices across email, WhatsApp, and voice, and applies incoming cash to the right invoices automatically — so your DSO falls without the manual chase.
Book a demoRelated terms
Accounts receivable · Cash application · DSO · Dunning · Browse the full glossary →