Small Business Accounting is Not Enough—You Need Cash Flow Coaching!
As a small business owner, you likely have a bookkeeper or accountant handling your financials. While traditional accounting helps you stay compliant with taxes and financial reporting, it doesn’t always help you manage your cash flow effectively.
Profit and revenue do NOT equal cash in the bank. Many businesses struggle, not because they aren’t making money, but because they don’t have cash available when they need it. This is where cash flow coaching comes in.
Why Cash Flow Management is Essential
Even a profitable business can face a cash crunch when waiting on unpaid invoices or dealing with unexpected expenses. Without proper planning, you could be making sales but still struggling to cover payroll, rent, or supplier payments.
Understanding the Difference:
- Revenue: The total amount invoiced, but not necessarily collected.
- Profit: Earnings after expenses, but it doesn’t mean cash is available.
- Cash Flow: The actual money that moves in and out of your business, determining if you can pay your bills.
Poor cash flow is a major reason why businesses fail—even profitable ones. But with cash flow coaching, you can proactively plan and make informed financial decisions.
How Cash Flow Coaching Helps Your Business Thrive
1️⃣ Tracking & Forecasting Cash Flow
A strong business needs a cash flow plan, not just a financial statement. By forecasting your cash flow, you can anticipate slow months, prepare for major expenses, and ensure you always have enough liquidity.
- Use a cash flow planner to track inflows (sales, receivables) and outflows (expenses, loan payments).
- Understand your cash conversion cycle—how long it takes to turn inventory or services into cash.
- Monitor key financial indicators, such as accounts receivable and payable cycles, to stay ahead of potential shortages.
2️⃣ Getting Paid Faster & Managing Receivables
One of the biggest cash flow killers? Delayed payments from customers. You might be selling a lot, but if clients don’t pay on time, you’re stuck.
Cash Flow Coaching Solutions:
- Send invoices immediately after completing a job.
- Set up automated reminders to follow up on outstanding payments.
- Offer early payment incentives (e.g., 2% discount for paying within 10 days).
- Accept multiple payment options, including credit cards and online transfers, to make it easier for customers to pay.
3️⃣ Smart Expense & Payment Management
Your outflows are just as important as your inflows. Managing expenses wisely can extend your cash availability and help you avoid unnecessary borrowing.
Key Strategies:
- Negotiate better terms with suppliers to delay payments without penalties.
- Match financing terms to expenses—use short-term loans for short-term needs, and long-term financing for big purchases.
- Avoid over-ordering inventory that ties up cash unnecessarily.
4️⃣ Diversifying & Strengthening Your Financing Options
Many small businesses rely too much on one funding source—often their personal savings or a single bank loan. Cash flow coaching helps you create a financing strategy that works for your business.
Key Tips:
- Build relationships with multiple lenders—banks, credit unions, and alternative financing sources.
- Use business credit lines strategically instead of maxing them out.
- Explore invoice factoring or financing if you have slow-paying clients.
5️⃣ Annual Cash Flow Planning
A cash flow crisis shouldn’t catch you by surprise. Reviewing your finances at the start of each year ensures you have a strategy in place to handle expenses, growth, and unexpected setbacks.
Questions to Consider:
- Do you need to hire more staff or buy equipment?
- How will major expenses impact your cash flow?
- Will you need financing? If so, how much and when?
A cash flow coach helps you create a realistic plan so you don’t have to scramble when cash is tight.
Cash Flow Coaching is the Missing Piece of Your Financial Strategy
Hiring a bookkeeper or accountant is a great first step—but it’s not enough if you want to build a financially strong business.
At Dexado Accounting & Tax, we don’t just crunch numbers—we help small businesses take control of their cash flow through strategic financial coaching.
Let’s talk! Contact us today for a consultation and get your cash flow working FOR you, not against you.
