5 Practical Cash Flow Principles for a Christian Business

April 28, 2016

C12 Group |


2016-04-28.jpgOne in four businesses fold due to chronic cash flow shortages. It’s not always possible to predict and fend-off cash flow problems. But, negative cash flow is real and can happen unexpectedly.   

Using proven Christ-honoring cash management principles, The C12 Group has developed proactive steps to help Christian business owners effectively monitor cash flow and alleviate shortages before they become dire.  

In accordance to Psalm 24:1 9 (NIV), we know “The earth is the Lord’s, and everything in it, the world and all who live in it…” So, here are 5 principles you can apply to keep the cash, and Spirit flowing in and throughout your business.

  1. Decrease receivables. Actively manage accounts receivable and quickly collect past due accounts. Often, slow collections are the result of disorganized procedures that are within our control. Timely collection begins with a sound strategy and policy for extending credit. If we give too much credit to those who do not warrant it, or fail to establish reasonable financial consequences, problems occur.

  1. Shorten collection times: Establish collection terms and create a consistent collection process the very day an invoice becomes overdue.  Some C12 Members suggest periodically offering special terms or inducements to encourage customers to pay early, thereby increasing the cash on hand.

  1. Request extended supplier terms.  As Christians in business this may seem tough as we have an obligation to pay what we owe, when it is owed.  we also have freedom to ask for temporary relief from creditors.  Suppliers are often willing to extend special terms to businesses they view as loyal, long-term customers. This can help buffer short-term cash deficits. By extending our payables and decreasing receivables, we can abbreviate our cash conversion cycle and improve cash flow.

  1. Increase margins:  By fully pricing for market value received and reducing costs, companies can reduce waste and redundancies.  During times of growth, it easy to be hasty and add overhead without clear justification.  Inflated payroll, misguided perks, poorly specified inventory and lax accountability will negatively impact our cash flow.


  1. Require transparency:  By making cash flow management a highly visible and important function within the business, we can eliminate surprises.  Develop a cash flow projection model that analyzes and monitors the daily inflow and outflow of cash. Include the management team to discuss ‘what if’ scenarios and cash flow contingency plans.

As Christians in business, it is our duty to meet our financial obligations and make decisions that will build a business that brings Him glory.  Each month, in peer groups of 10-12, C12 members focus on critical business aspects while being faithful Stewards of the businesses with which God has entrusted us 


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Debt and cash flow management are just some of the critical business topics C12 members discuss each month in their advisor peer groups.   If you would like to learn more about becoming a part of C12, find a group near you today.