Cash flow and profit are not the same thing
A business can be profitable on paper and still run out of cash. Here is why, and what to watch each week.
Profit is what is left after costs over a period. Cash flow is the money that actually moves in and out of your bank account, and when.
If customers pay in 60 days but suppliers want paying in 30, you can grow quickly and still be short of cash.
Watch three numbers every week: cash in the bank, invoices due in the next 30 days and bills due in the next 30 days.
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