0:02 Most small businesses don't die because
0:04 of poor ideas. They die because their
0:07 cash runs out. You can have great sales,
0:10 loyal customers, and strong products and
0:13 still struggle to pay bills on time.
0:15 That's the hidden danger of cash flow
0:18 problems. In this video, you will learn
0:21 how to fix your cash flow problems with
0:24 practical examples. Problem number one,
0:27 late payments from clients. Late
0:30 payments crush liquidity. If a project
0:33 invoice of $10,000 is delayed by 60
0:35 days, your bills still need to be paid
0:39 today. Fix this by offering 2% discount
0:41 for payments within 10 days, charging
0:44 late fees after 30 days, and switching
0:47 to milestone billing. For example, bill
0:51 50% upfront, 30% midway, and 20% at
0:54 delivery. This keeps steady cash instead
0:57 of waiting months for a single check.
0:59 Problem number two, high accounts
1:02 receivable aging. If your accounts
1:04 receivable are stuck at 90 days, it
1:07 means you are financing your clients. If
1:10 you have $60,000 stuck for 3 months,
1:12 that's money not fueling marketing,
1:16 payroll, or inventory. Fix this by
1:19 enforcing net 15 or net30 payment terms,
1:22 sending automated reminders at 7, 14,
1:25 and 21 days, and requiring credit checks
1:28 before extending large terms. The goal
1:31 is to reduce aging from 90 days to 30
1:34 days. Problem number three, seasonal
1:37 sales fluctuations.
1:39 If winter months bring in $40,000 and
1:42 summer months bring in $100,000,
1:45 you need a buffer strategy. Fixed
1:47 expenses like payroll, rent, and
1:50 software subscriptions remain constant.
1:53 Fix this by building a cash buffer equal
1:56 to 2 months of fixed expenses and
1:58 introducing offseason offers,
2:00 maintenance packages, or prepaid
2:03 discounts. Predictable monthly revenue
2:06 protects survival during slow periods.
2:11 Problem number four, low profit margins.
2:13 If you sell something for $100, but your
2:16 gross margin is only $20, your cash flow
2:19 will always feel tight. To fix low
2:22 margins, increase prices strategically,
2:25 cut cost of goods sold by renegotiating
2:27 with suppliers, or remove lowprofit
2:31 items. Even increasing margin from $20
2:34 to $30 per unit changes survival math
2:37 over 1,000 units. That's a $10,000
2:40 difference in available cash. Problem
2:44 number five, high operating expenses.
2:47 If your revenue is $50,000 monthly, but
2:50 your operating expenses are $40,000, you
2:54 only keep $10,000 for growth. Reduce
2:56 recurring expenses quarter by quarter.
2:59 Audit software tools, renegotiate
3:02 leases, review utilities, and remove
3:04 non-essential subscriptions.
3:09 A 10% cut in expenses on $40,000
3:13 saves $4,000 monthly or $48,000
3:16 yearly in cash retention. Problem number
3:20 six, uncontrolled spending. A business
3:23 earning $90,000 but spending $85,000
3:27 feels poorer than one earning $50,000
3:29 but spending $30,000.
3:31 Track spending weekly instead of
3:34 monthly. Use envelopes for ad budgets,
3:36 set department caps, and require
3:40 preapproval for anything above $500.
3:43 Spending discipline is the fastest cash
3:46 flow fix, even if revenue stays flat.
3:49 Problem number seven, overstocking
3:51 inventory. Buying too much inventory
3:55 ties up cash. If you buy $70,000 in
3:58 stock, but sell only $30,000 in 90 days,
4:02 $40,000 of cash is sitting on shelves.
4:05 Switch to just in time ordering.
4:07 Forecast demand based on threemonth
4:10 historical averages and stop emotional
4:13 buying. Every dollar of inventory is a
4:16 dollar not available to pay salaries.
4:19 Problem number eight, underpricing
4:22 products or services.
4:24 If you charge $80 for something
4:27 competitors charge $120 for, you are
4:30 leaving $40 per sale on the table.
4:33 Pricing too low forces higher volume to
4:35 survive, which strains operations.
4:38 Increase pricing by 10 to 15% first.
4:41 Most customers don't leave. That extra
4:45 10% on a $500,000 yearly revenue equals
4:49 $50,000 extra cash without selling one
4:52 extra unit. Problem number nine, weak
4:55 invoicing and billing systems. If
4:58 invoices go out late, cash comes in
5:00 late. When businesses invoice on the
5:03 15th instead of the 1st, they lose 14
5:06 days of cash timing. Automate invoicing
5:08 on the first day of every month. Enable
5:12 AC payments and remove manual PDF
5:14 invoicing. Faster billing equals faster
5:17 cash. Companies that invoice digitally
5:20 get paid up to 40% quicker. Problem
5:23 number 10, too much customer credit.
5:26 Giving every customer net 60 terms means
5:28 you are bankrolling their business. If
5:31 you have $100,000 stuck in credit terms,
5:34 that's cash you can't use. Fix this by
5:36 offering credit only to high trust
5:39 clients, requiring deposits, and turning
5:43 small clients into prepaid customers.
5:45 The best businesses in America get paid
5:49 before delivery or at least 50% upfront.
5:52 Problem number 11, short supplier
5:54 payment terms. If you have to pay
5:57 suppliers in 30 days, but customers pay
5:59 in 60 days, you will always suffer a
6:03 cash gap. Ask suppliers for net 45 or
6:06 net 60, or offer early payment only if
6:09 discounts are given. Extending terms by
6:12 15 days on $50,000 of monthly purchases
6:16 frees up $25,000 in working capital
6:20 every 30 days. Problem number 12, high
6:23 loan payments and interest costs. If
6:26 your monthly loan payments are $20,000
6:29 on a cash flow of $60,000, your margin
6:32 for error is tiny. Fix this by
6:34 refinancing highinterest loans,
6:37 negotiating longer amortization periods,
6:40 or accelerating payoff on small debts
6:44 first. Even reducing interest by 2% on a
6:48 $500,000 loan saves $10,000 yearly in
6:51 cash. Problem number 13, no emergency
6:54 cash reserves. When unexpected expenses
6:57 hit, like a broken machine costing
7:02 $8,000 or a tax bill of $15,000,
7:05 businesses without reserves panic. Build
7:07 an emergency fund equal to one month of
7:10 operating expenses, then grow it to 3
7:13 months. If your operating expenses are
7:18 $40,000 monthly, aim for $40,000 to $120,000
7:20 $120,000
7:23 reserved in a high yield account.
7:25 Emergency reserves also build
7:27 confidence. When a surprise repair or
7:30 tax bill hits, you pay without panic,
7:33 without loans, and without slowing operations.
7:34 operations.
7:37 This safety cushion is what separates
7:39 stable businesses from fragile ones.
7:42 Tracking daily business expenses keeps
7:44 your cash flow healthy and predictable.
7:46 This video shows simple ways to record
7:49 spending, avoid leaks, and keep money
7:51 under control so you never run short
7:54 again. Strong cash flow starts with
7:56 small daily habits. If you found these
8:00 tips useful, like the video, subscribe,
8:02 and start tracking your expenses today.
8:04 Your business will thank you when money
