Mastering Cash Flow: Practical Tips From Financial Strategist Ambro Blackwell

For small business owners, bringing in revenue is just the start. Managing cash flow is how you keep the business running. “The difference between cash flow and cash is that cash is stationary,” explained commercial financial strategist and author Ambro Blackwell. “Cash flow, [on the other hand] is like blood running through your body. If the blood stops flowing, you probably have some problems. So having cash is good, but having the right cash flow is better.”

While the concept is simple in theory, it’s one that many small business owners overlook. A business might have money in the bank today but still face a crunch tomorrow if bills come due before customer payments arrive. According to Blackwell, understanding and planning for this difference is one of the most critical factors in long-term financial health.

Often, entrepreneurs don’t fully understand the timing of their cash flow. “A business might sell a product or service, but the money doesn’t show up right away,” Blackwell said. “Meanwhile, they have expenses, bills or obligations coming in.” When outgoing cash outpaces incoming revenue, even a profitable business can find itself in the red. That’s why it’s crucial to take steps to predict future growth, challenges and financial needs before they catch you off guard.

Here’s how Blackwell recommends safeguarding your business against cash flow gaps.

Take Time To Forecast Your Business

Forecasting is the process of predicting your future income and expenses so you can make smarter financial decisions. “There are different forecasting models, and there’s plenty of business-planning software out there,” said Blackwell. “But ultimately, you need to be looking at how much money you expect to bring in, what costs you’ll incur along the way and when you actually expect to collect those payments.”

With forecasting, you can anticipate expenses, plan for tax deadlines and spot cash flow trends, giving you time to prepare for changes that could impact your bottom line. “You want to be able to work that out so you’re not caught off guard,” Blackwell added. “New tax deadlines, seasonal shifts — these things are coming, and you need to be ready.”

Use Benchmarking To Stay on Track and Adjust Your Business Strategy

While forecasting is about predicting what will happen, benchmarking is about measuring what actually happened and using that insight to course-correct. It’s how you check in on the health of your business by comparing your expectations to reality and adjusting along the way. It means “thinking about things like: ‘What’s going on? Who’s paying? Who’s not? What conversations are happening?’” said Blackwell.

But he also encourages a measured response, urging business owners to treat signs, such as customers asking for more time to pay or needing to dip into a line of credit, as data rather than disaster. This could involve boosting employee productivity, reducing expenses or finding new ways to grow profit margins, he said. The key is to stay realistic and willing to adapt. “A lot of business owners start out thinking: ‘I’m going to make a million dollars.’ OK, but did you even make a million in revenue?” Blackwell said. “You always have to keep testing, improving and making sure your expectations are grounded in reality.”

Create Financial Breathing Room Through Vendor Negotiations and Scale

In times of uncertainty, though, it’s critical to ease short-term cash strain. Blackwell encourages business owners to accelerate incoming cash while strategically delaying outgoing payments.

One tactic he recommends is negotiating better terms with vendors. “Ask if you can pay in 30 days instead of 15, or 60 instead of 30,” he said. More flexible terms give you extra time to cover expenses. Or see if you can secure a discount for paying earlier. “You should always ask, because there’s a number of companies that actually offer it to start,” he added. “If you don’t ask, they might not tell you.”

Scale provides another advantage. “The other thing is building a business strong enough where you have more suitors,” Blackwell said. “Company A and Company B might sell the service or products that you need for your business, but if you’re big enough where you’ve got companies C, D and E who also want your business, now you’ve got some negotiating leverage, not only in terms of the cost of service, but in the terms that you want to have.”

Ultimately, he said, it’s always worth having conversations with your vendors. “Asking doesn’t hurt anything,” he added. “And if you did ask and then things get tight for them, they may become open to offering some kind of terms for you.”

Use Discounts and Invoice Factoring To Get Paid Faster

Securing early payments can significantly enhance your cash flow. Sometimes that means offering incentives. “When you run a business, you should know your margins,” said Blackwell. “That way you can afford to offer discounts if it helps you get paid faster.”

Knowing your clients is key. “If your business allows it, pull credit reports on who you’re invoicing,” he suggested. “If you see they’re taking on more debt or starting to slip on payments, that’s your cue to have a conversation, and maybe offer a discount for early payment. It helps them, but more importantly it puts you at the top of their list.”

If customers are paying slowly, or not at all, another option is to sell outstanding invoices to a factoring company, which purchases your invoices at a discount then collects the payment itself, providing you immediate cash. “Sure, you take a hit. Maybe you get 70 or 80 cents on the dollar,” said Blackwell. “But that’s better than getting zero.”

Boost Cash Flow by Leveraging Credit Lines and Early Payment Discounts

Using financial tools wisely can give your business more breathing room. A line of credit, for instance, offers flexibility without dipping into your cash reserves. “Every business should have one,” said Blackwell. “What’s great about a line of credit is you’re borrowing from a bank, not your own cash, and [you] just gave yourself an extra 30 days.”

He suggests layering strategies for even more impact. “You can pay expenses with a credit card, then use your line of credit to pay that off,” he explains. “Now you’ve got up to 60 days while your sales come in.”

The real value comes from combining smart timing with smart saving. “A lot of companies offer terms like 2/10 net 30, meaning you save 2% if you pay in 10 days,” Blackwell explained. “That racks up over time. You save on one end, delay on the other and maybe even earn credit card points in between.”

“These little moves add up,” he said. “By the end of the month, or the year, you’ve got more cash on hand. Maybe enough to throw a Christmas party for your team.”

Prepare Early To Keep Your Business Afloat During Cash-Flow Challenges

Blackwell’s key message for small business owners is to plan ahead before challenges arise. “There’s always going to be a credit event — a cash crunch — at some point. But if you wait until your back’s against the wall, your options shrink fast.”

He added: “I always say it’s better to get your line of credit while you can get it, but don’t need it.” He likens it to boat maintenance. “You want to patch the boat before it’s sinking, not while it’s going down. Apply for a line of credit or establish financing before you’re desperate. That’s when lenders are more likely to help and your terms will be better.”

Establishing strong relationships matters, too. Having a trusted financial partner, whether it’s a bank, credit union or online lender, can make a difference when you need support the most.