Even profitable businesses can run into cash flow trouble, especially when hidden costs quietly erode your bank balance.
If you’ve ever thought “I should have more cash than this”, you’re not alone. Here are five common cash flow drains that go unnoticed in small businesses – and how to fix them.
1. Unused or duplicated software subscriptions
That $30/month app you signed up for last year? It adds up – especially when you’re paying for multiple tools that do the same job.
✅ Action: Do a quarterly app audit. Cancel or consolidate any unused subscriptions.
2. Poor follow-up on overdue invoices
Late payers are one of the biggest causes of cash gaps. If your follow-up is inconsistent, you’re leaving money on the table.
✅ Action: Set up automated invoice reminders in Xero or MYOB. For stubborn cases, use invoice tracking tools or a collection partner.
3. Underpriced or over-serviced jobs
If you’re consistently doing more work than you quoted for – or your pricing hasn’t kept up with costs – you could be bleeding cash without realising.
✅ Action: Review your pricing model and track job profitability. It may be time to raise rates or tighten scope.
4. Old or slow-moving stock
Tied-up inventory is money you can’t use. Holding too much stock (or the wrong stock) quietly drains your working capital.
✅ Action: Identify slow movers and clear them out with specials or bundles. Consider tightening your stock reordering triggers.
5. Excess drawings or unplanned tax bills
It’s easy to draw from the business too freely, especially when things are going well. But without forward planning, BAS, super, or tax time can sting.
✅ Action: Create a cash buffer for compliance payments. Work with a virtual CFO to set realistic drawings and tax forecasts.
🚨Cash tight? It’s time to shine a light.
If your cash flow feels tighter than it should be, you’re not alone—and there’s almost always a fix.
We offer one-off Cash Flow Snapshot Reviews to help identify quick wins and plug hidden drains. Contact us now!
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