Cash flow is the lifeblood of your business. We cannot stress this enough. This Lesson is an Introduction to Cash flow Management in a crisis.

Things like Revenue and Profit can be fudged whereas cash in the bank (Cash flow) cannot.

Revenue of $1,000,000 might look great until you realise the Expenses are $2,000,000.

Quality Data Management Systems

You may not be too keen on understanding your accounting system. But, managing your cash flow is one time it is very helpful to have a good accounting system; and know how to use it to your advantage.

In the Lesson on “Necessary Metrics“, within C4.7.1 in this Course, we discuss changes to your accounting system that are likely to be very useful. Additional knowledge can be accessed, here, in the Diagnostics section of 12Faces

Depending on your accounting system, you might find it useful to create a spreadsheet to budget your cash flow on an on-going weekly basis. If you are short of cash, survival may need this attention to detail at least until the business stabilises. If you don’t know your cash forecast, you may get nasty surprises. This link connects to the Victorian Government Cash flow template Spreadsheet


The Cash Conversion Cycle, which looks at money in and money out, is covered in the article: How to Measure Net Cashflow.

We have grouped our resources on Cash Flow Management under: Cash Flow Performance
Alternatively, further information can be accessed via the Diagnostics System linked in the black box below.

We also have a Skills Module: Profit Autopilot specifically on cash flow management techniques.

Implementing your cash flow management strategy should start as soon as possible. Even if your cash flow seems Ok at present. Far better to spend a little time now as a form of ‘life insurance’ in case your cash position turns bad later on.

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