The founder of a food service distribution company with 23 employees still checked the bank balance every morning before his first coffee. Every morning, he felt the same panic: the account looked strong on Tuesday and dangerously low on Friday, and he could not quickly tell which customers were paying on time and which were quietly stretching beyond 60 days. He was the only person at the company who saw the whole financial picture, and he admitted he did not actually understand it until four different spreadsheets had been aligned by hand.
The Owner Was the Bottleneck, and That Was Nobody’s Fault
His salesman closed a large deal with a restaurant group, and the order looked fantastic in the revenue column. What nobody translated into weekly visibility was that the contract allowed that customer 75 days to pay. The distributor had to buy the inventory, store it, and deliver it for more than two months before seeing a dollar in return, all while continuing to pay its own invoices on 30-day terms.
ERP Consulting‘s role here was not to redesign the whole company. It was to give the owner a single weekly review that let him spot cash flow patterns before they bit him. The first meeting took 90 minutes, and the most important question was simply: which ten orders currently in the backlog require us to spend money before our customers pay us?
A Weekly Cash Review That Fits on One Page
- List open orders older than 45 days, with the number of days since the invoice date next to each customer name.
- List every confirmed purchase order that requires inventory to be bought before the customer’s deposit arrives.
- Compare the next two weeks of expected cash collections against the next two weeks of required supplier payments, and only then decide whether the company can accept fast-growth orders without taking on a short-term loan.
This looks painfully obvious on paper, but the owner later admitted he had grown so fast that he managed his cash by memory. His memory was wrong at least twice a month. After eight weeks of the daily cash sheet and weekly review, he told me the single most useful change was dialoguing with his sales team about financing terms, not just selling price.
When the Growth Question Becomes a Financing Question
By the end of the quarter, he had shifted his best customers toward a 50 percent deposit for first-time orders and standard 14-day payment terms for repeat business. The bank line of credit stopped being used as a permanent float, and instead was reserved for true seasonal peaks. The answer to his old question, “where is the cash,” turned into a one-page view that even a vacationing owner could hand to his operations manager on Friday afternoon.
Run your own version of this review tomorrow. Print the accounts receivable aging, the open purchase orders, and the bank balance, and place the three pages side by side for ten unbroken minutes. Draw a circle around any order where you must spend money before the customer pays. If the circles cover more than a third of the page, your company is growing faster than its cash cycle allows, and no extra sales effort will solve that tension. A methodical review, where ERP Consulting helps you turn scattered numbers into a single rhythm, beats the owner’s instinct to simply watch the bank balance more anxiously each morning.