Cash Flow Management Tips for Small Indian Businesses

Cash flow kills more small businesses than no profit. Practical tips to forecast, accelerate inflows, delay outflows, and build a runway.

Cash flow vs profit

Profit is on paper; cash is in the bank. You can be profitable and still go bankrupt if money is stuck in receivables.

Build a 13-week cash flow

List expected inflows (invoices due, expected sales) and outflows (rent, salary, supplier payments, GST) for the next 13 weeks. Spot shortfalls early and act.

Accelerate inflows

Invoice same day. UPI QR on every bill. Automated reminders. Offer 2% early-pay discount for B2B. Take advances on big orders.

Delay outflows

Negotiate Net-30 with suppliers. Pay vendors on day 28, not day 5. Stage capex purchases to high-cash months.

Build a buffer

1 month of fixed costs as a minimum cash reserve. 3 months is healthy. Without a buffer, every unexpected expense becomes a crisis.

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