Your business is busy. Clients are coming in, work is getting done, and on paper it all looks healthy.
But your bank balance tells a different story.
You’re waiting on invoices, juggling payments, unsure how much you can take home, and that sinking feeling hits every time you log in to online banking.
If that sounds familiar, you’re not alone.
Many established businesses face cash flow strain long before they realise there’s a real problem.
The good news is that cash flow crises rarely happen overnight.
There are early warning signs if you know what to look for, and ways to navigate ahead safely.
Here are seven red flags that could signal your business is heading for trouble, along with practical steps to get back on track.
1. Your Bank Balance Is Running the Show
Sarah runs a busy design agency. Before committing to new software or paying a contractor, she always checks the bank. If there’s money, she goes ahead. If not, she delays.
Why it’s a warning sign:
This “bank balance management” approach keeps you stuck in reactive mode. It’s easy to lose sight of upcoming commitments like tax, payroll, or supplier bills and suddenly, there’s not enough in the pot.
Practical fix:
Build a simple 12-week cash flow forecast. A spreadsheet is fine — include expected income, regular outgoings, and one-off costs.
Review it weekly, so decisions are proactive, not panic-driven.
Think of it like switching on your headlights when driving at night — you can see what’s coming, not just what’s in front of you.
2. Invoices Go Out Late (or Not at All)
David delivers fantastic consultancy work, but invoices only get sent when he “has a minute” or sometimes weeks later.
Why it’s a warning sign:
Every day you delay invoicing is another day your money sits in someone else’s bank account. Over time, this creates a domino effect that unnecessarily tightens cash flow.
Practical fix:
Invoice as soon as work is completed.
Set a regular admin slot each week to keep on top of money tasks.
Automate invoicing and reminders where possible — let the tech chase payments for you.
3. Customers Are Slowing Down Payments
Lucy has a loyal client who always paid within 14 days. Lately, payments have stretched to 30 or even 45 days — and she feels awkward chasing them.
Why it’s a warning sign:
When payment terms start to slip, your cash flow suffers. If left unchecked, it can quickly spiral.
Practical fix:
Set clear payment terms on every invoice.
Send polite reminders a few days before the due date, and follow up immediately if the payment remains unpaid.
For persistent offenders, consider picking up the phone, as it’s often more effective than sending another email.
For larger projects, it’s wise to consider deposits or early payment incentives.
4. You’re Juggling Bills to Stay Afloat
At month-end, Mark lines up his bills and decides who gets paid now and who has to wait. Sometimes that includes VAT or PAYE.
Why it’s a warning sign:
When you’re choosing who to pay first, cash reserves are stretched. Delaying statutory payments can lead to penalties and damage relationships with suppliers.
Practical fix:
Prioritise essentials — wages, tax, critical suppliers.
Talk to HMRC early — they’re often more flexible if you communicate before deadlines.
Negotiate temporary extended terms with suppliers instead of missing payments.
Review whether costs can be reduced, delayed, or spread differently.
5. Credit Is Becoming a Crutch
Each month, Claire’s overdraft creeps higher and her business credit cards are maxed out. She tells herself it’s “just a timing issue,” but repayments are eating into the next month’s cash.
Why it’s a warning sign:
Credit can be useful, but when it becomes a lifeline, it’s a red flag. Relying on expensive revolving credit can trap you in a cycle that’s tough to break.
Practical fix:
Identify the root cause — is it slow payments, delayed invoicing, or overinvestment?
Create a realistic repayment plan rather than rolling balances forward.
If needed, explore structured finance options that give you breathing space without becoming a burden.
6. Profits Aren’t Matching the Bank Balance
On paper, Emma’s retail business is profitable. But her bank balance is low. She’s reinvested heavily in stock for the upcoming season, and supplier payments are due before sales pick up.
Why it’s a warning sign:
Profit doesn’t always equal cash. Timing differences, reinvestment, or hidden costs can leave you short even when the business looks healthy.
Practical fix:
Review profit and cash flow together to spot differences.
Map out when cash will actually move, especially for seasonal or project-based businesses.
Phase investments or negotiate supplier terms to smooth cash peaks and troughs.
7. You’re Flying Blind Without Current Figures
Tom only looks at his accounts at year-end. Day to day, he relies on gut feel — but he’s often caught off guard by unexpected bills.
Why it’s a warning sign:
Without timely financial information, you’re driving blind. Problems can build quietly in the background and only surface when they’ve become much harder to fix.
Practical fix:
Keep bookkeeping up to date — ideally weekly but at least monthly.
Use cloud accounting software for real-time visibility.
Set monthly review points to understand your position and catch issues early.
Spot the Signs Early, Take Control
Cash flow problems don’t happen overnight. They build through everyday habits and unnoticed warning signs. The earlier you spot them, the more options you have to turn things around.
The key is to move from reactive to proactive. With the right systems, habits, and support, cash flow problems can be fixed and often faster than you think.
If some of these warning signs are ringing bells, let’s have a conversation. We help ambitious business owners build solid financial foundations, protect their cash, and take control of their business because your business should give you freedom, not sleepless nights.
