Retail Solutions

What is cash flow?

What is cash flow?
What is cash flow?

Cash flow


If you own a business, you might have found yourself in a difficult financial situation at some point, but weren’t sure why? Wondering where the money was going? You need to understand cash flow and how to manage it properly.

A company runs with the help of funds, and not paying attention to the cash flow in and out of the organisation will result in losses for your business. Organisations need to keep complete details about their cash flow; keeping proper cash flow records will help you organise your finances and plan for the future.

Do you want to know about cash flow to control and manage finances? If so, keep following!


What is cash flow?


We can define cash flow as the documentation of all the financial movements of your business, with records of both the inflow and outflow of money.

Cash flow is the amount of cash and cash equivalents, such as securities that a business generates or spends over a set time.

That is, all revenues from the sale of products or services and expenses and costs arising from payments to suppliers, buying of goods, and rent, among others, are recorded for future analysis and intelligent planning.

Careful cash management brings many advantages, especially for small businesses, which rely on cash flow to pay expenses and keep the business running. Understanding the benefits of monitoring cash flow can help your business succeed.




Expand Your Business


A well-organised cash flow statement provides the ratio between your income and expenditure. By having this information, you can identify the company’s financial position and have enough information to check if you have what you need to expand your company.


Get a Business Loan


Banks will study the financial condition of the company as well as the power of the organisation to repay the loan amount before giving out money. To prove the ability of the organisation to repay the amount, they use the cash flow statement as proof because it holds complete details about the cash inflow and cash outflow of the company.


Keep track of overdue payments


Keeping on top of late payers is often a complex and demanding task. Having prompt and accurate information about late payers and their impact on the bottom line provides you with more effective credit control.


Plan for upcoming cash gaps


Cash flow gaps happen when there is a lapse in the timing between cash going out and cash coming in. For example, when you have already paid all your suppliers, but haven’t yet received payment from your customers. Cash flow gaps can soon turn into business failure. Spotting them before they happen allows you to put plans in place to avoid them.




Budgets are an essential part of organisational planning. They are usually managed annually or quarterly. Farseeing annual budgets prepared using cash flow statements help with the development of a business. You can use them to monitor your business performance, and create business strategies accordingly.


Track spending


Every business has revenue goals and targets; cash flow forecasting can help a business owner to understand if they will reach those goals and when.

Forecasting allows you to see the breakdown and impact of your budgeting. Whether over or under budget, seeing the movement of cash into and out of business can help increase future budgeting accuracy.




Basically, cash flow management tracks how much money is coming in and going of your company. As we’ve explained above, this helps you predict how much money will be available to your business in the future. It also lets you identify how much your business needs raise to cover expenses, such as paying employees and suppliers.

A POS System can help you keep track of all your business transactions. A good Electronic Point Of Sale System (EPOS) can help you spot trends, prepare for the future, and tackle potential financial problems quickly. This keeps your business’s cash flow under control as you have complete visibility of all financial movements.


Who are we?


Retail Solutions is a market-leading EPOS provider with over 25 years of business experience. Our leading sectors are convenience storessupermarketsforecourts, and pharmacies.

We are dedicated to providing your store with the most up-to-date and reliable point-of-sale hardware and software management tools to help you manage your business effectively.

Our self-checkout partners are NCR, which are global leaders in self-checkout technology. 

To find out more about what we do, get in touch to chat with one of our knowledgeable consultants:


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About the author:


Juliane Camozzato is an Executive Marketing at  Retail Solutions. You can follow her on LinkedIn!


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