Break Glass for Cash: A Micro Business Reality

Cashflow. For many micro business owners, it feels like a magic trick - now you see it, now you don’t. Money comes in, work is steady, clients are happy and yet, somehow, there’s nothing left in the account at the end of the month. That sinking feeling? It’s more common than you think.

And, while it might feel like you’re doing something wrong, most of the time, it’s simply about how money moves through your business and the hidden gaps that go unnoticed until it’s too late.

So, before we look at the fixes, let’s unpack the causes.

Why the cash sometimes isn't there in a micro business, even when sales are good

Cashflow isn’t a mystery, it’s a system. But, when you’re in the thick of it, it often feels like chaos. The client work is rolling in. The pipeline looks healthy. But the bank balance? Still flatlining.

What’s really happening is a lag between the effort, the invoice, and the payment. You sign a new client, but the deposit is late. You finish a project, but the terms stretch to 30 or 60 days. Meanwhile, your own outgoings can't wait.

To make matters worse, many micro business founders get stuck in feast-or-famine mode. One month they're pitching, the next they're delivering, and by the time they look up, they're chasing the next job again. It’s a cycle that plays havoc with their reserves and your confidence.

So, how can you manage your cashflow better? It starts with visibility. Weekly tracking (not monthly) reveals the patterns. A basic calendar showing when money’s due in and when it’s going out creates a buffer between panic and planning.

Once you’ve got that visibility and the beginnings of a buffer, the next step is understanding why the gaps happen in the first place. Because most of the time, it’s not one big mistake. It’s a handful of small, recurring issues that chip away at your cashflow, month after month.

Let’s break it down.

5 Common Cashflow Mistakes (and How to Fix Them)

1. You’re not paying yourself properly.

This is one of the biggest (and most common) issues for micro business owners. If you only pay yourself when there’s ‘enough’ left over, you’ll always feel broke, even when the business is doing well. Without a consistent salary, it’s difficult to build personal financial stability, and the line between ‘profit’ and ‘survival’ gets increasingly blurry.

Solution: Build your salary into your pricing from day one. Profit isn’t what’s left after expenses, it’s what’s planned in. Even a modest, regular transfer into your personal account can shift your mindset and give your cash planning a solid foundation.

2. Your payment terms are working against you.

You finish a project. You send the invoice. And then… nothing. For 30, 45, even 60 days. Meanwhile, your own bills, taxes and expenses don’t wait. This mismatch creates a cash drought, one that can derail growth and cause needless anxiety, even when you're profitable on paper.

Solution: Tighten your terms. Offer early payment incentives. Or, for recurring services, switch to upfront billing. Make it easy for clients to pay quickly by setting clear expectations and using automated reminders. The faster the cash comes in, the more breathing space you create.

3. You’re reinvesting too quickly.

Growth is great. But if every win is followed by a ‘next level’ investment - new hire, new platform, bigger office, you’ll struggle to build a cash buffer. Ambition without pacing often results in lumpy cashflow and constant catch-up.

Solution: Slow down the reinvestment cycle. Give wins time to settle into profit before moving to the next leap. Ask yourself: will this investment generate revenue in the next 90 days? If not, consider delaying it. Cashflow loves breathing room.

If your decisions are driven by pressure more than planning, this podcast on developing a culture of self-responsibility might help; once clicked, scroll down to the ‘onefish’ podcast.

4. You’re mixing business and personal finances.

It’s incredibly common in micro businesses, especially in the early days. But if your business account is covering personal shortfalls (or vice versa), it’s almost impossible to track what’s really going on. Unclear lines lead to unclear decisions, and it gets harder to grow with confidence.

Solution: Separate your accounts. Set up a regular transfer for your salary. Give yourself clear visibility. Use different cards, separate logins, and basic budgeting tools to keep things clean and trackable. You can’t manage what you can’t see.

5. You’re not forecasting.

This doesn’t mean building complex spreadsheets. It means having a rough idea of what’s coming in and what’s going out over the next 3 months. A lack of forward visibility turns routine expenses into unwelcome surprises.

Solution: Build a simple cashflow calendar. Mark your big invoices and major outgoings. Spot the gaps before they hit. Even a basic Google Sheet or wall planner will do the job. The goal is not perfection, it’s preparation.

FAQs

What’s the difference between profit and cashflow?

Profit is what’s left after expenses — on paper. Cashflow is about timing: when money actually arrives or leaves your account. You can be profitable and still run out of cash.

How often should I check my cashflow?

Weekly checks are ideal. This helps spot shortfalls early and avoids end-of-month panic.

What’s a cashflow buffer and how much should I have? 

A cashflow buffer is a reserve of cash that gives you breathing room. A good rule of thumb is at least one month’s worth of expenses, but more if your income is inconsistent.

What tools can I use to track my cashflow as a founder?

You don’t need expensive software. A simple Google Sheet or cashflow calendar works well. If you want automation, tools like Float or Xero’s cashflow dashboard can give extra visibility.

How do I manage cashflow when income is unpredictable?

Focus on smoothing out your outgoings where possible and build a basic buffer. Even one month’s core expenses can create a cushion that gives you time to react, not panic.

What’s the easiest way to start forecasting?

Begin with a 90-day view using a simple spreadsheet. Plot expected income and recurring expenses to identify pressure points.

How do I stop mixing personal and business money? 

Start by opening a dedicated business bank account and tracking income and expenses.

Final thoughts.

You’re not alone if cashflow feels like the one thing you can’t quite get on top of. But with a few simple changes - from better planning to clearer pricing - you can take back control. It’s not about being perfect. It’s about putting systems in place that help you grow with confidence.

Want more practical help?

Alan Wick’s Business of Finance® course is designed to give founders like you the tools, mindset, and momentum to run a financially confident business.

Learn more and enrol today →