Owned and Operated - A Plumbing, Electrical, and HVAC Business Growth Podcast #224 Top Cash Flow Mistakes in Home Services and How to Fix Them
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Jul 17, 2025 The hosts dive into the critical differences between cash flow and profit, revealing how misunderstandings can jeopardize a business. They share personal horror stories of cash flow struggles and emphasize the importance of automated savings and cash forecasting. Listeners gain insights on best practices for managing debt, navigating financial complexities, and making timely decisions to avoid cash crunches. With practical tips and real-life examples, this discussion is invaluable for anyone seeking to enhance their business's financial health and sustainability.
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Cash Flow Is Not Profit
- Cash flow differs fundamentally from profit metrics like EBITDA or net profit.
- Incoming revenue is not the same as usable cash for business expenses.
Cash Outlays Outside Profit-Loss
- John shared how $113,000 cash left the bank for capital expenses and debt payments not reflected in net profit.
- This explains why net income and cash available often differ significantly in practice.
Use Cash Flow Forecasting
- Implement a regular cash flow forecast to track upcoming expenses and break-even revenue needs.
- Knowing your monthly cash outflows helps prevent surprises and poor cash management.
