Cash flow struggles have long been a top reason small businesses fail, representing a critical aspect of financial management that small business owners try to stay on top of. This year is no exception. BILL’s recently released 2025 State of Financial Automation Report, an annual survey conducted with the SMB Group, reveals that 60% of those surveyed say cash flow is their top priority in 2025.
BILL’s report shows SMBs are primarily concerned about inflation right now, with 42% of those surveyed citing “managing business in an inflationary environment” as their top challenge. And smaller businesses (10-49 employees) were even more worried about this issue than bigger companies. BILL says this is a “pressing” concern for business owners, increasing by 5 percentage points from 2024.
The second biggest financial challenge for SMBs is managing cash flow volatility. Because cash flow is so critical, business owners have already leapt into action by:
- Sending electronic invoices—62%
- Accepting more payment types—61%
- Improving inventory management—54%
- Offering customers discounts for early payment—48%
- Conducting customer credit checks—47%
- Implement penalties for late payments—47%
- Expanding supplier networks—47%
- Changing payment terms—44%
- Increasing prices—42%
- Leasing/subscribing to goods/services instead of buying—38%
The business owners who haven’t yet acted plan to this year. The top three strategies they will implement:
- Expanding supplier networks—44%
- Increasing prices—41%
- Leasing/subscribing to goods/services instead of buying—39%
And, of course, don’t forget to take advantage of all new technologies. As BILL’s CEO and founder, René Lacerte, wrote when announcing several new company innovations, “One of the most critical steps businesses can take in the face of uncertainty is to reinvent how they run and grow cash flow.”
Graphic courtesy: BILL
Rieva Lesonsky is President of Small Business Currents, LLC, a content company focusing on small businesses and entrepreneurship. While you can still find her on Twitter @Rieva, you can also reach her @Rieva.bsky.social and LinkedIn. Or email her at Rieva@SmallBusinessCurrents.com.
