How can you regain control of your cash flow when every day counts?

A bank balance you’d rather not look at, salaries paid ten days late, suppliers waiting in line. This scenario is nothing out of the ordinary. It describes the daily reality of companies facing cash flow constraints. And yet, more often than not, the problem isn’t a lack of money, but a mismatch between cash inflows and outflows.

Let’s take the example of one of our clients, a small-to-medium-sized food distribution company that had just emerged from bankruptcy proceedings. Its growth was picking up again, but its cash flow had hit rock bottom. Yet it regained control thanks to a practical approach that we’ll share with you here.

Recognizing the warning signs

Before taking action, you need to assess the situation. The key metric is the runway: the number of months your company can operate on its current cash reserves without additional funding.

Runway (in months) = Available cash / Average monthly cash burn

Example: With €100,000 in cash and a monthly cash burn of €20,000, the runway is 5 months.

In theory, the calculation is simple. In practice, the reliability of the runway can be compromised if:

• The actual cash burn differs significantly from the average, which can result in a gap of several months between the theoretical runway and reality,
• It is based on static assumptions (constant costs, stable working capital, no major changes). In a growing environment, these assumptions rarely hold true.

Here is the framework we use in the field:

• Runway > 6 months: Normal operations, optimization of traffic flows, no exceptional measures
• Runway of 3 to 6 months: Activation of defensive measures: intensifying customer follow-ups, proactively negotiating supplier payment terms, freezing non-critical spending, and actively preparing for financing or a transaction
• Runway < 3 mois : Changement de posture : arbitrage hebdomadaire (voire quotidien) des paiements, priorisation stricte (salaires, charges sociales, fournisseurs critiques…) et négociation d’échéanciers (URSSAF…)

These thresholds help structure the decision-making process and enable a response before cash flow becomes critical.

The 4 key factors that make a difference

Replace the 15 Excel files with a single source

Accurate, consolidated data is the foundation of any cash management decision. In practice, Excel spreadsheets— overloaded with manual entries and adjustments—often have the opposite effect: biased decisions and issues identified too late.

In the case under review, the omission of a single supplier invoice for €50,000 was enough to skew the entire forecast and mask a cash flow situation that was far tighter than anticipated.

In fact, reliable data is based on four principles:

• Automatic updates from data sources (banks, billing, payroll), without manual entry
• Automatic detection of discrepancies and inconsistencies between data streams
• Assumptions that are clearly identified and separated from the actual data
• Full data traceability

It is this methodological framework—not the complexity of Excel formulas—that turns numbers into actionable insights.

Create a cash flow forecast that can be updated as needed

Forecasting cash inflows, fixed costs, and variable costs is essential for anticipating when— and by how much— cash flow will tighten. For SMEs, the challenge was to model raw material purchases in the face of uncertain future customer orders.

Our solution: a simple hypothesis, reviewed weekly with the operational teams.

We allocated 50% of each customer order to raw material purchases, based on the average historical consumption rate.

In practical terms:

1. As soon as a sales order or sales forecast is recorded, the system automatically sets aside 50% of its amount for procurement expenses.
2. Each week, the director of operations reviews this assumption based on:

• Confirmed orders and their specific raw material requirements
• The actual status of inventory
• From its visibility into supplier shipments

This cycle transforms cash flow management into an ongoing dialogue between finance and operations, where projections are progressively refined without tying up cash based on fixed assumptions.

Negotiate payment schedules to ease cash flow constraints

In tough times, every day counts. Negotiating with suppliers, customers, or even the URSSAF allows you to spread out payments, smooth out expenses, and buy yourself some breathing room.

Specifically, here are the top priorities for negotiation:

• URSSAF: payment plans spanning 12 to 24 months, provided the company can demonstrate a credible turnaround (significant upcoming customer orders, financing currently being negotiated, etc.)
• Key suppliers: 15- to 30-day payment terms on large invoices
• Major clients: requests for advance payments or accelerated payment of invoices

For our client, negotiating a payment plan with URSSAF made it possible to spread the payment of approximately €60,000 over 12 months.

Golden rule: Negotiation is not an end in itself, but a means to be used to resolve the situation. Without a credible prospect of a turnaround, a payment plan merely postpones the inevitable.

Allocate payments on a week-by-week basis based on available cash

To minimize the impact of working capital, it is essential to align outflows with the pace of inflows without hindering business operations . For example:

• "We're only paying salaries this week, until invoice No. 125 is cleared."
• “We’re postponing the purchase of the new machine. For now, we’re focusing on outsourcing.”

The goal? Optimal cash flow, not a freeze on business operations;

Result: From Survival to Controlled Growth

Thanks to this method, the small business was able to prioritize its use of cash and anticipate financial strain. The result:

• To operate for more than 24 months without significant funding
• Working capital remained stable despite a 24% increase in business activity between the first half of 2023 and the first half of 2025
• €30,000 allocated for the launch of a new product line

What if this small business had continued to manage its operations using an Excel spreadsheet riddled with errors?

It would have remained stuck in a reactive, ad-hoc management style, lacking reliable visibility, and would have been at the mercy of disbursements rather than controlling them.

• At Day 60: Without reliable projections, the executive would have continued with the planned hiring and ordered the new machine, tying up €25,000 in available cash.
• 75 days after launch: The new product line was reportedly launched, depleting the remaining funds. The additional working capital requirement (estimated at €30,000) was reportedly not anticipated.
• If 90 days had passed: The company would have found itself in default, forcing it to either secure emergency financing on disastrous terms or shut down operations entirely.

The system didn't just "improve" the situation. It prevented certain failure.

In practical terms, if you want to regain control of your cash flow, you have two options:

• Option 1: Hire a financial controller: Expect to pay between €40,000 and €50,000 per year in salary, plus several months before the person fully understands your cash flows, priorities, and business model. In the meantime, your cash flow will continue to tighten. If their expertise doesn’t align with your startup’s reality, the risk is high and time is of the essence.

• Option 2: Manage your cash flow yourself with Warcash: Starting at €149/month and requiring just a few days of setup, followed by 1 to 2 hours per week for your financial decisions, you’ll benefit from a proven methodology tailored to situations like yours and a customized tool. You use your business knowledge and mastery of the plan to manage your cash flow effectively: without delays and without relying on others.

Taking back control of your cash flow isn't a matter of intuition, but of method.

This approach—managing by pace rather than by balance, using different scenarios and clear decision thresholds—is, above all, an operational framework. A framework that, to be applied rigorously, requires a system designed specifically for it.

It is precisely to formalize this approach that we developed “Warcash ”: not as“just another cash management tool,” but as a system that embodies this logic, automates data, and structures decision-making during periods when every day counts.

Are you facing the same situation? Contact us for a personalized demo and find out how "Warcash" can help you regain control of your cash flow.

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