Cash flow gaps are something we see come up time and time again with business owners across East Anglia.
On paper, the business can look healthy. Sales are coming in, work is steady, and things appear to be moving in the right direction.
But behind the scenes, there’s pressure.
A cash flow gap is simply a period where more money is going out of your business than coming in, even when you factor in your cash reserves.
And the challenge is, many businesses don’t realise it’s happening until they feel the impact.
That often shows up as:
• Worrying about covering wages
• Delaying payments
• Or feeling busy, but still short on cash
We recently worked with a business owner here in Bury St Edmunds who was doing well in terms of sales and demand.
But every month, the same concern came up:
“Are we going to cover salaries?”
When we looked at the numbers, the issue wasn’t revenue.
It was timing.
They were offering 30-day payment terms, which meant cash was coming in too slowly to match what was going out.
We reduced payment terms from 30 days to 14 days. This didn’t happen overnight. It involved conversations with existing customers and setting expectations with new ones.
But once it was in place, the pressure eased almost immediately.
It also required a shift in mindset. Just because something is considered “standard practice” doesn’t mean it’s right for your business.
If you want to take control of your cash flow, the first step is understanding where the gaps are coming from.
That means looking at:
• When money comes in
• When money goes out
• Where delays are happening
Once you can see it clearly, you can start to take action.
Here are some simple, effective ways to improve your cash flow:
These aren’t groundbreaking ideas, but they’re often overlooked during the day-to-day running of a business.
For most businesses, unpaid invoices are one of the biggest causes of cash flow pressure.
It’s not just about whether you’ll get paid.
It’s about when.
A few simple measures can give you better visibility:
• Average collection time – how long it takes to get paid
• Receivables vs sales ratio – how much of your revenue is tied up in credit
• Ageing reports – which customers are consistently late
This helps you spot patterns and take action early.
It’s just as important to understand your outgoing payments.
An accounts payable schedule gives you visibility on:
• what’s due
• when it’s due
• how much cash is required to cover it
This allows you to plan ahead and avoid unnecessary pressure.
Cash flow is one of the most important parts of any business.
In many cases, it’s the difference between growth and stress.
When you understand your cash flow and take control of it, everything else becomes easier. You can plan ahead, make better decisions, and focus on growing the business.
If you’d like support reviewing your cash flow and identifying opportunities for your business, the best place to start is a conversation.
👉 Book a call and start the conversation.