Why Adding Clients Won't Fix Your Cash Flow Problems

When money gets tight, many business owners try to fix the problem by selling more work as fast as possible. They focus on bringing in new clients. They think more sales will fix their empty bank account. But if your service prices are wrong, getting more clients will just drain your cash even faster.

Good cash flow management starts with tracking exactly what it costs to do the work. New work takes real cash right away to pay staff and buy supplies. If your prices don't cover all your team and office costs, every new client takes cash out of your bank account before they pay their bill. You end up spending more money than you bring in.

There’s a simple fix for almost all cash flow problems: profitable pricing strategies that charge for the real value you deliver. And, hint – the value you deliver – it’s worth more than the hours you bill.  Your billable hour should be the floor, not the ceiling on the prices you charge.  Unheard of in your industry?  That’s why you’re all burnt out!  Strategic pricing based on value isn't easy, but it helps you make more money on every job and keeps your bank account full.

Also, throw away old annual budgets that sit on a shelf. Start using a rolling thirteen-week cash plan instead. Watching money flow in and out week by week helps you see problems early. You can keep your cash safe, pay your bills on time, and pay yourself well every single month without guessing.