Accounting Basics
Cash Flow Basics for Small Businesses
Why profitable businesses still run out of cash, and simple invoicing and payment habits that keep money flowing.
By Billora Editorial Team · Published · Updated
Profit is not cash
A sale on Net 60 terms is revenue today but cash in two months. Meanwhile you still pay rent, wages and suppliers. That timing gap is why profitable small businesses can still find themselves short of cash.
Five levers you control
- Invoice immediately — every day of delay is a day later you get paid
- Shorten payment terms or request deposits
- Make paying easy with online payment options
- Follow up consistently on overdue invoices
- Know your margins so pricing covers overhead
Track what you are owed
Keep a running list of unpaid invoices with their due dates. Reviewing it weekly takes minutes and is the single best early warning of a cash crunch.