Cash Flow Problems: Why You Feel Broke Even When You’re Profitable

You check your P&L—it shows a healthy profit.

But your bank balance?

Barely enough to cover wages, BAS, or your own drawings.

If this sounds familiar, you’re not alone. At HelloLedger, we work with business owners every day who say the same thing:

“I’m making money, but it doesn’t feel like it.”

Profit and cash flow are not the same thing—and if you’re only tracking one, you might be flying blind. In this post, we’ll unpack the three most common reasons why profitable businesses still feel cash-poor—and what to do about it.

Fixing Cash Flow Problems

When your business runs out of cash—even temporarily—it doesn’t matter how profitable you are on paper. One of the biggest causes? You’re not getting paid fast enough.

If your clients take 30, 45, or even 60 days to pay, you're covering wages, rent, and materials before money hits your bank account. This creates pressure, debt reliance, and that frustrating feeling of always being behind.

And that’s just one of the common causes.

Let’s look at three reasons profitable businesses still feel broke—and what to do about each one.

Reason 1 – You’re Getting Paid Too Slowly

Even if you’ve invoiced for $50,000 of work, it doesn’t count for much if none of it has hit your bank account yet.

Slow payments (aka high debtor days) are one of the biggest hidden causes of cash flow issues. If clients are taking 30, 45, or 60+ days to pay, you're left covering wages, rent, and suppliers without the cash to back it up.

What to do:

• Shorten your payment terms (e.g. from 30 to 14 days)

• Use automated reminders to chase invoices politely but consistently

• Make it easy to pay: use Xero “Pay Now” buttons, Stripe, PayPal, or card links

• Break large jobs into milestones so you get paid along the way

Example: A business earning $600,000 per year that reduces debtor days from 45 to 30 could free up $25,000+ in working capital—instantly.

Reason 2 – You’re Carrying Too Much Stock or WIP

Cash flow problems often come from money being tied up in work-in-progress or unused stock.

This is especially common for:

• Builders or trades with large upfront material costs

• Product-based businesses ordering in bulk

• Agencies doing lots of project work before invoicing

If you're spending thousands on materials, labour, or production before invoicing, you’re always playing financial catch-up..

What to do:

• Track your WIP monthly

• Invoice progressively (don’t wait until the end of the job)

• Order stock just-in-time, not just-in-case

• Use systems that flag aging stock and incomplete jobs

At HelloLedger, we help businesses track WIP and stock levels in real time—so cash doesn’t disappear into the unknown.

Reason 3 – Your Expenses Hit Before the Income Does

This is a timing problem—and it causes major cash flow problems even in profitable businesses.

If you’re paying rent, wages, and supplier bills before your client payments come in, your business constantly runs lean (or negative). It’s not that you’re spending too much—it’s that the cash isn’t flowing in sync.

What to do:

• Create a weekly cash flow forecast (not just monthly)

• Reschedule expenses where possible (e.g. pay fortnightly, negotiate with suppliers)

• Build a 1–2 month cash buffer to stay ahead

Our clients often say, “I finally feel in control of my money again.” That’s the power of fixing timing issues behind cash flow problems.

You Don’t Have to Feel Broke to Be in Business

Cash flow problems don’t mean you’re failing.But they are a sign that your systems and timing need attention.

The good news? With small changes—like faster payments, better financial visibility, and smarter timing—you can take control of your cash flow and finally start to feel the profit you’re earning.

📞 At HelloLedger, we help business owners reduce cash flow problems and build businesses that feel calm, clear, and profitable. Book a free discovery call with HelloLedger today