Cash Flow Management: Turning Economic Pressure into Financial Strength
Lisa Atkinson, SVP Treasury Management, Columbia Bank
In today’s economy, managing cash flow is as critical as ever. With interest rates still elevated, inflation lingering, and supply chains behaving unpredictably, businesses need to be intentional with every dollar. Whether you’re running a small business or a growing midsize enterprise, there are practical steps you can take to strengthen your cash position and stay agile.
Start with Your Working Capital
One of the first things I recommend is reassessing your working capital. Many businesses still rely on manual processes for invoicing and payments, which slows down collections and increases risk. A detailed review of your receivables, payables, and payment cycles can uncover inefficiencies that are quietly draining your liquidity.
We often find that businesses are sitting on untapped working capital simply because their processes haven’t evolved. A few small changes—like automating approvals or digitizing invoices—can unlock significant cash and reduce costs.
Automate to Gain Control
Integrated payables solutions allow you to manage invoices, approvals, and payments from a single platform. This improves visibility, ensures compliance with vendor terms, and reduces fraud risk. More importantly, it gives you control over the timing of payments, which is key to optimizing cash flow.
On the receivables side, automation can be a game-changer. Reconciling customer payments manually is time-consuming and expensive. By integrating receivables automation with your ERP system, you can streamline all payment types into one workflow. This not only saves time but can reduce operating costs by up to 80%. And when you have real-time visibility into your cash position, you can make smarter, faster decisions with confidence.
Embrace Real-Time Payments
Real-time payment networks like RTP and FedNow are transforming how businesses manage liquidity. Receiving funds instantly means less reliance on credit lines and better cash forecasting. If your customers are still paying by check or slow ACH, it’s time to explore faster options and integrate them into your systems.
Use Commercial Cards Strategically
Commercial cards aren’t just about convenience anymore. They can extend your float by up to 25 days, reduce paper-based payments, and even generate rebates. Virtual cards are especially useful for secure vendor payments and can simplify reconciliation while improving your ability to forecast cash needs.
Cash flow is the foundation of business resilience. In uncertain times, optimizing your financial operations can unlock working capital, reduce borrowing costs, and position your business for growth. At Columbia Bank, we’re here to help you navigate these challenges and build a more agile, efficient financial strategy.
