Your Shopify dashboard says you're rich, but your bank account says 'LOL nope'?
Every once in a while we see the same story play out.
A founder books a call with us, $300K monthly revenue. 45% margins. Record-breaking growth.
Then comes the confession: "I'm not sure how much longer I can keep this up."
Despite the top-line growth, they're trapped in an endless cycle:
- Scrambling to pay suppliers
- Maxing out credit cards for ad spend
- Watching their personal savings drain away
- Living invoice-to-invoice
After working with many ecommerce brands, we've learned this: Revenue is vanity, profit is sanity, but cash flow? Cash flow is reality.
And success can bankrupt you if your cash flow isn't managed right.
The problem? Most founders are building their cash flow strategy through trial and error. They're learning expensive lessons the hard way.
Today, we're sharing the exact framework we use to help our clients break free from the cash flow trap. Whether you're doing $50K or $5M a month, these strategies work.
Because here's what doesn’t get talked enough about ecommerce: It's not about how much you sell. It's about how much cash you keep.
Let's fix that cash flow chaos once and for all.
Prefer to watch? Check out the video:
Understanding Cash Flow Forecasting
Having a strong cash flow forecast can help you see around corners and make those difficult decisions you've been nervous about.
You know the ones - should you invest in that new product line? Can you afford to scale up your marketing? Is it time to hire that operations manager?
Think about cash flow forecasting like weather forecasting.
Sure, it won't be 100% accurate, but wouldn't you rather know there's a 70% chance of rain than walk out the door with no idea what to expect?
Even a simple forecast will provide more value than having none whatsoever. Don't let perfect be the enemy of good.
How to Improve Cash Flow for eCommerce Brands
Here are some proven tactics to keep more cash in your online business.
1. Optimize Your Inventory Reordering
The most impactful thing you can do for any ecommerce business is to nail your inventory management.
It's a delicate balance - too much inventory ties up your cash, too little means missing out on sales.
Accurate forecasting helps immensely with this; it'll help you reorder inventory just in time to meet sales demand without overspending.
2. Clear Out Slow-Moving Inventory
Here's a hard truth: that inventory sitting in your warehouse isn't an asset - it's cash trapped in boxes.
It's better to sell inventory that cost you $100K for $80K of cash rather than sitting on $100K of dead stock forever.
Yes, running clearance sales isn't ideal. Deep discount pricing tactics can hurt your brand and cannibalize full-price sales.
But sometimes, you need to bite the bullet and free up that cash to reinvest in products that actually move.
3. Reduce Your SKU Count
Take a hard look at your product lineup. Are all those variations really necessary?
Focus on your best sellers and cut the dead weight.
Fewer SKUs means better inventory management and more efficient cash flow.
It's not about having less - it's about having the right products that actually drive your business forward.
4. Extend Your Payables
Here's a simple but powerful move: delay your bill payments to the last possible date without incurring penalties.
This keeps cash in your account longer.
Your vendors are also people who need to manage their cash flow as well, so maintain a good relationship with them.
A good relationship with suppliers is worth its weight in gold.
5. Negotiate Better Payment Terms
If you've built solid relationships with your suppliers, don't be afraid to ask for longer payment terms.
The difference between paying in 30 versus 60 days can dramatically improve your short-term cash flow.
Will they all say yes? Maybe not.
But you'll never know unless you ask.
6. Credit Card Payments
Some payment platforms let you pay bills that would normally require bank transfers using a credit card instead.
Yes, you might pay an extra 2-3% fee, but buying yourself an extra 30-60 days of cash flow can be worth it.
Think of it as a small premium for better cash flow management.
Let's break down a real-world example: You have a $50,000 inventory bill to pay.
With a traditional bank transfer, you'd need to pay the full $50,000 immediately on March 1st. That's $50K instantly out of your cash flow.
But here's where it gets interesting with a credit card payment:
- You charge the $50,000 on March 1st
- Your statement closes on March 15th
- Payment isn't due until April 15th
- Total cost: $51,500 (including 3% fee)
Yes, you're paying an extra $1,500 in fees. But think about what you could do with $50,000 for 45 days:
If you invest that money in ads with a 2.5x ROAS (Return on Ad Spend), you could generate $125,000 in revenue - leaving you with $73,500 in net profit after paying the credit card bill.
The right card can make a huge difference in your cash flow timing.
7. Optimize Wholesale Payment Terms
If you've expanded into wholesale, here's a move that can significantly impact your cash flow: try setting up your invoicing with shorter terms.
Instead of the standard net 30, push for net 15.
Will every buyer agree? No.
But some might, and every day counts.
Offer a small discount for early payment. Something like:
- Net 30 for full payment
- 2% discount if paid within 10 days
Sure, you lose a bit of margin on that 2% discount, but getting cash 20 days earlier means you can reinvest it sooner.
Sometimes you have to spend money to make money.
8. Set Up a Wholesale Shopify Site
Here's a game-changer many brands overlook: create a separate Shopify site just for smaller wholesale customers.
Why? Because it lets them pay by credit card immediately instead of waiting for invoice payments.
Benefits:
- You get paid instantly
- Less administrative work chasing payments
- Customers can order 24/7
- Automated inventory tracking
9. Automate Payment Reminders
If you're not actively following up on late payments, you're leaving money on the table.
Smaller companies often get lazy about this because they don't have a dedicated accounts receivable person.
And guess what? Customers who aren't being chased will forget or just take their sweet time paying.
Set up automated reminders in your accounting software to:
- Send payment reminders 5 days before due date
- Follow up the day payment is due
- Escalate with overdue notices
- Track payment patterns
10. Switch to Monthly Ad Platform Invoicing
If your ad platform offers monthly invoicing, jump on it.
Here's why: Instead of your credit card being charged for every $900 Facebook ad spend, you can wait until the end of the month and pay 30 days after that.
This means you'll see the revenue from your ad spend before you have to pay for the ads themselves. It's like getting a free loan from your ad platform.
Think about it:
- Day 1: Run ads
- Days 2-30: Generate sales
- Day 60: Actually pay for the ads
11. Use Specialized Credit Cards
Not all credit cards are created equal.
Some business cards offer much longer payment cycles specifically for advertising spend.
This isn't just about collecting points - it's about strategically timing your payments.
A specialized business credit card can offer:
- Up to 60-day payment cycles
- Higher limits for ad spend
- Better categorization for expense tracking
- Lower fees on business-specific categories
12. Leverage Short-Term Financing Options
Merchant cash advances or lines of credit can be useful to bridge cash flow gaps, but they're like power tools - helpful when used correctly, dangerous if mishandled.
Warning: It's dangerously easy to slip into using debt as a crutch. Before you know it, you're on a debt treadmill just to keep the lights on.
When to consider short-term financing:
- Seasonal inventory purchases
- Clear ROI opportunities
- Bridge timing gaps in accounts receivable
- Emergency situations
When to avoid it:
- Covering regular operating expenses
- Paying off other debt
- When you don't have a clear repayment plan
13. Analyze Your ROI
Time to get real about where your money's going.
Pull up your profit and loss statement and look for anything that's not pulling its weight.
Money sitting in underperforming areas is basically dead cash.
Key areas to analyze:
- Marketing spend by channel
- Product profitability
- Employee productivity
- Software utilization
- Service provider costs
14. Manage Your Subscriptions
You'd be shocked how many businesses are bleeding cash through forgotten or underused subscriptions. Those $50-100 monthly tools add up fast.
Fun fact: Most businesses only use about 40% of their software features but pay 100% of the cost.
Quick wins:
- Switch annual plans to monthly during tight periods
- Audit team member access
- Consolidate overlapping tools
- Negotiate multi-tool bundles
- Cancel zombie subscriptions
15. Cut Fixed Costs (Temporarily)
Here's the thing about fixed costs - they don't care if you're having a good month or a bad month. They just keep coming.
But many "fixed" costs aren't as fixed as you think.
What you can do:
- Pause non-essential services
- Renegotiate rent or lease terms
- Reduce office space
- Switch to flexible staffing models
- Optimize utility usage
Remember: Cutting costs is about being smart, not cheap. The goal is to emerge stronger, not crippled.
Can you improve cash flow in 30 days?
Within 30 days, you can significantly improve your cash flow by implementing even just a few of these strategies.
Some will deliver results immediately:
- Clearing out old inventory
- Extending your payables
- Switching to monthly ad invoicing
- Setting up automated payment reminders
- Cutting unnecessary subscriptions
Others might take a bit longer but create lasting impact:
- Optimizing inventory management
- Negotiating better payment terms
- Setting up wholesale systems
- Streamlining your product line
The key isn't implementing everything at once - it's picking the strategies that make the most sense for your business right now.
Need Help Getting Started?
If you're looking to implement these strategies but aren't sure where to start, watching our video on building an ecommerce forecast might help.
As ecommerce accountants, this is exactly the kind of work we do day in and day out.
Remember: Cash flow management isn't just about surviving - it's about creating the financial flexibility to grab opportunities when they appear.
The better you get at managing it, the faster you can grow.
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