You can be profitable and still run out of cash — because profit isn't cash. This diagnostic finds where your money is trapped: receivables, inventory, capex, or debt repayment.
What this tool does
You enter your profit and balance-sheet movements; it shows where profit turned into something other than cash, so you can free it up.
Who it's for
Founders and operators confused by a healthy P&L and an unhealthy bank balance.
How to use it — step by step
- Enter your profit. What the P&L says you made.
- Enter working-capital changes. Receivables, inventory, payables movements.
- Add capex and debt. Asset purchases and loan principal repaid.
- Read where the cash went. The gap between profit and cash, itemised.
How to read your result
Profit becomes cash only after working capital, capex, and debt principal. The biggest trapped-cash culprit for growing businesses is receivables and inventory — chase those first.
Worked examples
The same tool behaves differently depending on what you put in. Here are 3 situations.
Receivables ballooning
Inputs: Sales up, collections slow.
What the tool shows: Shows profit trapped in unpaid invoices.
What to do: Tighten collections and terms before anything else.
Inventory buildup
Inputs: Cash tied up in stock.
What the tool shows: Shows profit sitting on the shelf.
What to do: Reduce order sizes; match stock to demand.
Loan principal
Inputs: Repaying debt principal.
What the tool shows: Explains cash leaving that never hits the P&L.
What to do: Plan cash around the repayment schedule.
Common questions
How can I be profitable but broke? Profit isn't cash — working capital, capex, and debt consume it.
What's the usual culprit? Receivables and inventory in growing businesses.
What fixes it fastest? Collect faster, hold less stock, and time debt around cash.