News & Insights from republic bank

Managing Cash Flow

As a consumer, monitoring cash flow for your own personal account is important because it indicates how much, where, and how often you are spending your earnings. Not only is managing cash flow important for your personal accounts, but it is also critical for increasing profits and ensuring financial stability for your business. 

What is cash flow?

Cash flow refers to the movement of money in and out of a company. Cash that is received represents an inflow while the money spent represents an outflow. While your company’s revenue may be doing well in the books, remember that your business requires money (stable inflow, loans, or grants) to pay your debts/obligations and your suppliers (expected outflow). 

How can you manage your company’s cash flow? 

The most efficient and consistent way to manage the cash flow of your business is through a basic cash management model. 

Before creating a cash management model, you must understand what your cash cycle looks like on a typical basis. 

A typical cash cycle could look like this (it’s okay if it doesn’t mimic this exact model – every business is unique!) 

  1. Outflow of cash by company for goods and services (rent, resources, capital expenses, etc) and institution of a funding source (grant or loan)
  2. Selling of product or service to consumer
  3. Completion of payment from customer 

How can you build a basic cash management model?

Building your basic cash management model includes evaluating your typical cash cycle, recognizing your company’s inflow and outflow of cash, and creating cash management model objectives. Some cash model objectives may include: 

  • Short term profit management
  • Long term planning and budgeting
  • Interest and debt reduction

Creating a basic cash management model that fits the needs of your company is key to providing tactical data that will move your business forward efficiently and consistently. 

Why is managing cash flow critical to optimizing earnings for your business? 

Do you feel like your business is constantly changing and evolving? That’s because it is! As a business owner, you have the authority and the freedom to tweak your cash management model as you see your company grow and mature. Tweaking your model helps to optimize your earnings and how you decide to spend them in the future. 

Managing cash flow in your business through a basic cash model is critical to optimizing your earnings because it brings awareness of your spending and earnings. As a result, monitoring your inflow and outflow encourages predictive analytics to gain future insight and gives you the confidence to make big business decisions. 

Need more help getting started managing your company’s cash flow? Talk with a banker and contact us today at 800.526.9127 or visit our website at

Get Connected

Please enter your details below and one of our experts will connect with you shortly.

Get Connected

Please enter your details below and one of our experts will connect with you shortly.