Startups frequently describe their financial health in terms of burn rate and runway (respectively, how much money they're spending per month and how long until they run out of money). Those are important metrics when you're spending like crazy and surviving on...
‘The Best Damn Small Business Newsletter on the Internet’ archives
Cash Flow Article Archives
4 ways to charge clients upfront
New entrepreneurs and business owners frequently fall for the Net 30 trap. They accept Net 30 payment terms (aka, getting paid 30 days after the invoice) because they think that's just how business is done. They don't realize there's another way (or don't quite...
Throwback ⏰: Proactively look for surprise expenses to improve your long-term cash flow
Proactively managing cash flow is more than just enforcing payment terms, delaying your cash outflows, and building a tiny emergency fund. You should also actively look for potential cash flow problems and proactively plan for them. Because, surprise expenses that...
Be realistic with your cash flow goals. It’ll never be perfect.
Sporadic and unhealthy cash flow makes running a business even more stressful than it already is. Instead of focusing on client work or strategic decisions, you'll be distracted by making payroll, paying next month's rent, and moving enough money around to make do....
Systemize your owners’ bonuses for more predictable cash flow
There's a variety of reasons why you may've become an entrepreneur and started your own business. You might've wanted a better work/life balance, more flexibility, to be your own boss, you were laid off, etc. But, money is always part of the equation. (You have bills...
The symptoms of disorganized cash distributions (and how to correct them)
Small business cash flow is an incredibly complex topic with lots of nuances. Every single aspect of your business impacts your cash flow. That's what makes rooting out the core cause of your cash flow issues and fixing them such a difficult process. It can take...
Business savings isn’t just for emergencies
Most small business owners don't have an extensive finance background before starting their businesses. You're good at a particular skill (eg, marketing, design, writing, coding, law, whatever), you saw an opportunity to open a business, and you went for it. This...
A (very) basic order of operations for paying yourself from your business
Small businesses grow in stages. In the beginning, there's a clamoring for personal financial stability (aka you gotta earn enough money to buy food and pay rent). In that stage, the most important things are generating revenue, being profitable enough, and paying...
Search for bottlenecks in your invoicing process
Improving cash flow seems simple on the surface. You just speed up invoice collection, slow down bill payment, and make sure you have capital available for emergencies. But, that's easier said than done. Textbook cash flow advice will only get you so far. For example,...
Improve your cash flow by collecting client payment info during contract signing
At its core, improving cash flow has a lot to do with the timing and availability of cash in your business. That's why mega-corps will delay paying bills for as long as possible, because it leaves money in their accounts longer and improves the overall cash...
Proactively look for surprise expenses to improve your long-term cash flow
Proactively managing cash flow is more than just enforcing payment terms, delaying your cash outflows, and building a tiny emergency fund. You should also be actively looking for potential cash flow problems and planning for them. Because, a surprise expense that...
Understand your cash flow better with a master recurring expense calendar
Recurring expenses are a major, major factor in small business cash flow. Things like rent, utilities, payroll, loans/leases, and software expenses are constantly drawing against your business revenue, profit, and emergency fund/war chest. Understanding, anticipating,...
Credit card debt is like quicksand
Credit card debt is a funny thing. It's brutal and can quickly overwhelm your business with its 15%+ interest rates. But, it's frequently glamorized by entrepreneurs. Many entrepreneur influencers suggest funding your early-stage business with credit card debt or...