"Investors know this well, which is why they look at cash flow long before forming an opinion about revenue. Sales may draw attention, but the way money flows through the business reveals its absolute stability. Many companies use cash flow forecast software to get a practical view of how money will move in the coming weeks. It helps them see when cash is arriving and when it will be needed."
"Revenue shows how much your business earns from sales. It provides a view of activity and demand, but does not tell you when that money will arrive. Tools like Cash Flow Frog can help businesses track the timing of cash inflows and outflows more clearly. A company can post substantial revenue while still struggling to cover basic expenses if payment cycles are slow."
Cash flow determines a company's ability to meet obligations and survive downturns, while revenue measures sales activity without timing. Forecasting tools reveal the timing of inflows and outflows, showing when cash will arrive and when it will be needed. Investors prioritize steady, predictable cash movement because it indicates liquidity, operational discipline, and resilience during slow periods or growth. A business can report high revenue yet struggle if payment cycles delay cash. Reliable cash flow reduces crisis risk and signals readiness for scaling by ensuring funds to cover daily demands and unexpected needs.
Read at London Business News | Londonlovesbusiness.com
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