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Are you ready to increase your cash flow in 2024? Our country seems to have a collective surge of motivation at the start of every new year. Just ask gym owners, who suddenly (and happily) become overrun with new memberships. We can apply that energy toward other areas of our lives including business. If you are looking to become more profitable in 2024, here are some simple steps to improve cash flow.

Cheers to a new year and another chance for us to get it right.”Oprah Winfrey

Cash Flow Statement

According to statistics, 82% of United States businesses fail because of cash flow problems. Positive cash flow is when there is more money coming into the business than going out. Negative cash flow is when the cost to run the business is greater than the money coming in. A cash flow statement outlines the inflow and outflow of cash over a period of time and should include operating costs, investments, loan repayments, sales, and financing.

Review your budget and accounts weekly

The simplest way to determine your current cash flow is to review your budget. If you are not keeping an eye on this data, start now. Enlist the support of your accounting software tool which should provide reports that track monthly bills and expenses, including rent and employee salaries, plus all of the money you have coming in. Business activity fluctuates, so it is important to stay abreast of cash flow throughout the year to inform future decisions about your business. You want to build positive cash flow so that you can grow. Be disciplined and schedule a weekly budgeting review until it becomes a habit.

Examine your outflow

Don’t assume everything in your budget has to remain. Are there any glaring expenses that could be lessened? Do you over-order and then have a surplus of supplies sitting on a shelf? Can you negotiate with suppliers for better rates? Is your rent more than you can afford? Can you minimize costs in any area? This could mean extra research and effort is needed on your part to find savings, but it will be worth it. You want to run your business efficiently and cutting back on cash outflow could make the difference.

Speed up your invoicing process

If your method of collecting payment from clients leaves you hanging, reconsider the terms on contracts/invoices. You can change the terms so that clients are clear on expectations and deadlines for payments. Other options include offering payment plans or requiring deposits for projects that have large upfront costs. You could also create an incentive program that offers discounts or rewards to customers who make early payments. Probably the simplest improvement is to get invoices out as soon as possible. Letting them sit and wait just extends the time it takes to receive payment. Keep up on cash inflow to stay positive.

Create a Forecast

Creating a cash flow forecast helps you recognize the ebb and flow of your business. This type of preparation can help you predict when times are lean and you need to cut back, or when times are flush, and you can expand, innovate, or invest. Pick a timeline for your forecast. Based on your budget, historical data, and expected needs, you should be able to determine your cash flow for the next several months. Forecasts can help you determine when you have the flexibility to make larger loan payments and spare you those costs when cash inflow is limited. If summer is your busy season, pay your rent for the next few months so that you are set when customer activity slows in winter.

Build a Cash Reserve

We all know the ups and downs of life. The same holds for business. We’ve learned this the hard way by living through a pandemic and watching business after business close. Start building a cash reserve for any unforeseen issue. The amount of cash you need depends upon the size of your business and industry. It is recommended to have at least four to six months of operating expenses saved. Look to your forecast to determine the best time to put extra cash aside.

Professional Support

One accounting statistic claims that60% of small business owners feel they aren’t very knowledgeable about finances. That said, it takes time to work on your finances and you may need to spend much of that time running your business. Ciaccia CPA helps busy entrepreneurs stay ahead of their finances. We begin by reviewing your invoicing, payroll, purchasing, and payment processes and suggesting ways to speed up cash collections. We can prepare cash flow forecasts and projections. If you are in debt, we can create payment schedules or find bank loan packages to get you back on the plus side.


Cash flow isn’t only about pushing sales to bring in new clients. Much of your gain could come from recognizing overspending and finding ways to lower costs. All businesses need a net during rough times and that is where your cash reserve comes into play. Use that beginning-of-the-year enthusiasm to catapult you into healthy financial habits that will support your business for years to come. We wish you a prosperous 2024 and, if you need us, we’re here to help!