Cash flow is negative every month despite growing profit on paper

What we told them

Growth consumes cash, and profitable growth consumes the most. You pay for materials and labour before the customer pays you, so every additional order widens the gap — the faster you grow, the worse it gets. Calculate your cash conversion cycle: days of stock plus days of receivables minus days of payables. Shortening any one of those three is worth more than another 10% of sales, and it is usually receivables.