How to Fix Business Cash Flow Issues: 7 Common Problems (And Solutions)
Running a business that turns over more than a million dollars a year comes with its own set of cash flow headaches. You’ve got a team to pay, bigger bills, and longer sales cycles, and sometimes it feels like the bank account doesn’t quite match the effort you're putting in.
If you've ever thought, "We should be doing fine - so why does it feel tight?" …you’re not alone.
Here are six cash flow questions we hear all the time from business owners just like you - plus some practical, no-fluff advice for getting on top of it.
1. “How long can we keep going at this pace?”
It’s one thing to know your bank balance, it’s another to know how many weeks or months of expenses you can actually cover (e.g. tools are down for Christmas, can you cover this time?). When you’ve got recurring costs like wages, rent, software, and suppliers, this becomes the number one question.
What to do:
Use a rolling 13-week cash flow forecast to spot shortfalls early.
Focus on timing, not just totals - when money lands is just as important as how much.
Even the most profitable businesses can get caught out by mismatched timing.
2. “Can we actually afford to hire someone right now?”
Hiring feels like growth but it also adds serious pressure to cash flow.
It’s not just the salary you need to consider, but also onboarding time, super, bigger BAS bill (now with higher PAYGW), and tools or software. And in many cases, the benefit of that new hire won’t show up for months.
What to do:
Forecast the full cost of hiring over the next 6–12 months.
Make sure cash flow can comfortably absorb the new cost - even if revenue dips.
Hiring from a place of cash flow clarity = way less stress later.
3. “Why does it feel like we’re making money, but always short on cash?”
This one comes up a lot. It usually means the business is profitable on paper, but the cash is tied up somewhere. It’s common when your business is growing and you’re stretching to invest in future growth.
What to check:
Are customers taking too long to pay?
Are you spending upfront (e.g. stock, project costs) before the income lands?
Can you get your suppliers on terms that align to your income?
Often it’s not a revenue issue, it’s timing. And fixing the lag between when you do the work and when the cash arrives can make a huge difference.
4. “When exactly are we getting paid — and can we speed that up?”
Getting paid on time should be the default, not the exception. But too often, businesses leave invoicing, follow-up, and terms to chance.
What to do:
Send invoices promptly and follow up automatically, raise interim invoices (to cover some material costs) or charge upfront.
Review your payment terms - can you shorten them? Or offer early payment incentives?
Consider ways to minimise friction and offer a variety of payment options - accept credit cards, use links for online payments etc
The goal is to make it easier (and faster) for clients to pay you — without chasing constantly.
5. “Should I use a loan or credit to get through this patch?”
When cash is tight, finance can seem like an easy fix… but it should come with a strategy, not just a sigh of relief.
What to ask first:
Is this a short-term timing issue, or a deeper cash flow pattern?
Will this finance buy you time or trap you in repayments?
Consider if the higher interest will eat into your profits (and your ability to service debt)
Sometimes a short-term loan, overdraft, or line of credit is the right move. But it’s best to get advice before jumping in, especially with high-interest options like credit cards or merchant cash advances.
6. “What happens if things don’t pick up soon?”
This is the quiet question, the one business owners ask themselves when they’re worried but not ready to say it out loud.
It’s completely valid to wonder what your “plan B” looks like. You’re not being negative, you’re being responsible.
What to do:
Map out a worst case cash flow scenario (yes, really) - what are your trigger points and at exactly what point will you take action?
Identify what can be paused, deferred, or cut if needed.
When you know your numbers, you get options — and options are what reduce panic when things get uncertain.
7. “Do we have enough to cover our tax bills?”
This one sneaks up on a lot of business owners, especially when things are going well. You're growing, you've got solid revenue, and then boom - BAS is due, super’s on the horizon, or that chunky income tax bill arrives.
It’s not that you didn’t earn the money, it’s that it’s already been spent.
What to do:
Set aside a % of every dollar that comes in - weekly or fortnightly is ideal.
Keep that money in a separate bank account so it’s out of sight, out of mind.
Aim to stash enough to cover BAS, super, income tax and even payroll tax (depending on your state and scale).
You’ll thank yourself later when tax time rolls around and you’re not scrambling for cash. Bonus: your accountant will think you’re a legend.
Hot tip: Label the account something like “Do not touch (Tax)” or “ATO’s money” to keep yourself accountable - your future self will thank you.
The Bottom Line
Even if your business is growing, cash flow can still feel messy. That’s normal, BUT it doesn’t have to stay that way.
With the right tools, processes, and support, you can turn your cash flow stress into clarity… And instead of reacting to surprises, you can make decisions with confidence.
If you're ready to get on top of your cash flow (and actually sleep at night), let’s chat. We help growing businesses like yours stay cash-smart, not cash-strapped.
Our accountants are experts at partnering with business owners like you who are thinking of their future. Start the conversation about the future of your business.
