Cash Flow Statement: Your New Priority? (+Template)

Why Putting Together a Cash Flow Statement Should Be Every Business Owner’s Top Priority

Welcome to the cash flow Club!

Here is how, I've implemented cash flow tracking several times and it had a tremendous impact. It also changed how I look at business management for startups: Thinking Big but remembering that as a startup we are actually tiny and very vulnerable. The one thing that can make or break a startup? Its simple…Running out of cash!

Cash flow management is not just about the tool, it’s also a mindset.

Let's dive right in!

When running a business, it’s easy to focus on your profit and loss (P&L) statement. But having led several companies, I can tell you this: a better way to monitor your business’s health is by focusing on your cash flow statement. While the P&L tells you whether your company is profitable, the cash flow statement shows you what truly keeps your business alive—how money moves in and out of your company.

As a business owner, it’s not just your priority to understand and manage cash flow—it’s something your entire team needs to be aligned on. Let’s break this down into actionable steps to help you and your team manage cash flow like a pro and run your business like a well-oiled machine.

Think Like an Épicerie Owner

Picture yourself running a small épicerie (corner store). What’s most important to you? Tracking the money coming in from customers and the money going out for supplies, rent, and wages. That same mindset applies to your business, whether you’re running a tech startup or a manufacturing company.

Cash flow is your lifeline, and your focus should be on:

1. Money coming in (cash inflows): Payments from customers, advances, and potentially funds from investors or loans.

2. Money going out (cash outflows): Salaries, tools, rent, utilities, and other recurring expenses.

Encouraging your team to adopt this same mindset will help create a culture of accountability where everyone understands how their role impacts cash flow.

Understanding Cash Inflows and Outflows

Cash Outflows: More Predictable

Most cash going out is relatively stable and easy to plan. Salaries, tools, travel, and operating costs are regular and predictable. For every euro spent, always ask yourself:

• What are we getting in return?

• Does this spending align with expected cash inflows, and by when?

• Do we truly need it, can we eliminate or lower it?

Cash Inflows: Less Predictable

Customer payments can be uncertain, often delayed, or tied to milestones. This is why it’s critical for you and your team to track and prioritize inflows effectively:

• Focus on short-term inflows (next 90 days).

• Balance mid-term inflows (90–180 days).

• Plan for long-term inflows (beyond 180 days).

Start by focusing on cash from customers, not secondary sources like investors, grants, or debt. Why? Because relying too much on external funding can become an addiction—one that costs equity, control, and sometimes even the future of your business.

Make Cash Flow a Team Priority

Sharing the cash flow statement with your team is key to ensuring alignment and focus. It will:

1. Shift the sales team’s focus:

   • Negotiate payment terms that match your cash flow needs.

   • Avoid becoming a "bank" for your customers with long credit terms.

   • Encourage advance payments by offering extra value (e.g., discounts, priority service).

2. Responsibilize production teams:

   • Link project milestones to payments.

   • Monitor delays—whether due to client feedback, scope creep, or internal bottlenecks—and address the root causes promptly.

3. Drive cultural change:

   • Make cash flow visibility a regular practice.

   • Help everyone understand how their work directly impacts the company’s financial health.

Avoid Cash Flow Pitfalls

Prevent Late Payments

Late customer payments can devastate your cash flow. Protect yourself and your team by:

• Including late fees and admin charges in contracts (in compliance with local laws).

• Vetting customers’ payment histories to avoid bad payers.

Manage Delays Internally

Delays in delivering goods or services often stem from:

• Poor upfront planning: Unclear specifications or timelines lead to back-and-forth and wasted time.

• Scope creep: Clients changing requirements mid-project, which delays completion.

• Overcommitment: Taking on too many projects at once.

• Poor capacity planning: Not having enough staff to perform the work, failing to hire on time, or underestimating resource needs.

• HR problems: Losing key talent or experiencing high turnover can disrupt timelines and strain your team.

Learn from industries like car manufacturing: If a factory delays car deliveries, final payments are delayed too, while recurring bills (utilities, payroll, etc.) still need to be paid. Always ask: Is your backlog manageable? Are delays avoidable?

Plan Your Cash Flow Like an Investor

Think of yourself as the primary investor in your company. Before spending, always ask:

• How much cash out?

• How much cash in?

• When will I see a return?

Encourage your team to adopt the same mindset. Build your cash flow statement to track:

1. Opening balance: How much cash you have at the start of the period.

2. Expected inflows: Payments from customers, advances, and other sources.

3. Expected outflows: Salaries, tools, and operating costs.

4. Ending balance: Your cash level at the end of the period.

Here’s a simple cash flow checklist to guide your planning:

• Prioritize customer payments over external funding.

• Regularly review cash flow projections (weekly or monthly).

• Postpone mid- or long-term investments until short-term cash flow is stable.

Download the template

Track Bi-Weekly, Not Monthly

One final piece of advice: give yourself more time. Just like cats are said to have nine lives, startups often live and die by short timeframes. A year of startup life is like several years for a mature business. Instead of tracking cash flow monthly, shift to bi-weekly tracking.

Why? Monthly tracking can allow dangerous slippage. A small delay in one week might snowball into a crisis by the end of the month. Bi-weekly tracking gives you tighter control, allowing you to address issues faster and avoid surprises.

This approach demands discipline but creates a cultural shift that will set you apart, keep you free, and ultimately make you happier. Why? Because with cash comes runway—the number of months your business can survive. With runway comes peace of mind. And peace of mind is priceless.

A Culture Built Around Cash Flow

By managing your cash flow statement and sharing it with your team, you’ll align everyone on what truly matters: the financial health of the business. Sales teams will negotiate better payment terms, production teams will minimize delays, and leadership will make smarter investments.

This alignment creates a culture of accountability and urgency, ensuring every team member plays a role in maintaining healthy cash flow.

Final Thoughts: Cash is King

Cash flow isn’t just a financial metric—it’s the lifeblood of your business. It’s a priority for you as a business owner and for your entire team. By tracking it bi-weekly, aligning your team, and treating every euro as an investment with a return, you can build a sustainable, thriving company.

Start thinking like an épicerie owner today, be close to your money and you’ll set your business up for long-term success.