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Finance Glossary

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Cash Flow


Cash is sometimes like water, flowing and ebbing its way around. Cash flow just refers to the process of money flowing in and out of a business. It involves cash inflows, or money flowing in to your business from customers and sales, and cash outflows, like the cash you have to pony up to fix that radiator again. 


When your great grandparents ran their grocery store, at the start of the day there was likely something like $114.52 cents in a big fat cigar box with a lock on it. Then they sold lettuce. And Ipecac. And dead cow parts. They also bought pasta from the pasta purveyor who happened by. And paid the rent collector when he knocked. And they paid their help the day wages due. And so on. And at the end of that day, there was $122.68 in the cigar box. They had cash flow over that period of $8.16. And in those days, that bought a small house.