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# Why is cash tight when we’re profitable?

The plain answer

Profit and cash are not the same thing and never were.

Profit is what the accounts say you earned over a period. Cash is what is in the bank on a Tuesday. The gap between them is made of ordinary things – work delivered in March and paid in May, payroll that lands whatever the month looked like, tax that arrives by the quarter, the subcontractor or the stock you paid for up front. A profitable month can still be a month where more money left than arrived.

The gap itself is not the problem. The problem is that nothing is showing you what is coming. Many owner-led businesses run on the bank balance, which is an accurate record of where you have been and says nothing about the week after next – so the tight week gets handled in the week it lands rather than the quarter it was visible. Everything costs more in that week: the borrowing, the discount, the concession to the customer who sensed it.

What closes it is a forward view, usually thirteen weeks, built from what the business already knows – work won, work likely, costs committed, and the timing of both. Not a guess about next year. A schedule of what is already on its way.

That changes the question you can ask. “Can we afford this?” has no answer from a bank balance. “It breaks in week nine, and it doesn’t in week thirteen” is a decision.

Answered by Kristina Walls, who leads the financial practice. More on [the finance seat and how it runs](https://stoneforgegroup.com/financial-leadership/).

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