Small businesses are the backbone of any economy, and they play a crucial role in job creation and economic growth. However, during times of crisis, such as a pandemic, many small businesses struggle to stay afloat. Cash flow is the lifeblood of any business, and managing it effectively is critical to survival. In this blog post, we will discuss some tips for small business owners to manage their cash flow during times of crisis and weather the storm.

  1. Assess Your Current Situation:
    The first step in managing your cash flow during a crisis is to assess your current situation. Review your financial statements, including your income statement, balance sheet, and cash flow statement, to determine your current cash position. Identify any potential cash flow issues and prioritise them based on their impact on your business. This assessment will help you determine the steps you need to take to manage your cash flow effectively.

  1. Create a Cash Flow Forecast:
    A cash flow forecast is a projection of your future cash inflows and outflows. Creating a cash flow forecast can help you identify potential cash flow issues and develop a plan to address them. You can use historical data and assumptions to create a cash flow forecast. Make sure to include all sources of cash inflows and outflows, such as sales, expenses, payroll, and taxes.

  1. Cut Non-Essential Expenses:
    During times of crisis, it is essential to cut non-essential expenses to conserve cash. Review your expenses and identify any non-essential expenses that you can eliminate or reduce. This may include reducing your marketing budget, renegotiating your lease, or postponing non-critical capital expenditures.

  1. Negotiate Payment Terms:
    Negotiating payment terms with your vendors and suppliers can help you manage your cash flow effectively. Request extended payment terms, such as net 60 or net 90, to give you more time to pay your bills. You can also negotiate discounts for early payment, which can help you save money and improve your cash position.

  1. Increase Your Cash Inflows:
    Increasing your cash inflows can help you manage your cash flow during a crisis. Consider implementing strategies to increase your sales, such as offering discounts or promotions, expanding your product or service offerings, or targeting new markets. You can also consider alternative financing options, such as factoring or invoice financing, to improve your cash position.

  1. Seek Financial Assistance:
    During times of crisis, many government and non-government organizations offer financial assistance to small businesses. Research and identify the available financial assistance programs and apply for them if you are eligible. Financial assistance can help you bridge the gap between your cash inflows and outflows and improve your cash position.


Effectively managing cash flow is crucial for small businesses to survive during times of crisis. By implementing the tips mentioned above, such as creating a cash flow forecast, cutting non-essential expenses, negotiating payment terms, increasing cash inflows, and seeking financial assistance, small business owners can navigate through challenging times and come out stronger.

Remember, managing cash flow is an ongoing process, and it is essential to regularly review and adjust your strategies to maintain financial stability.