2 min read
Definition
A cash outflow is any movement of money out of a business — supplier payments, wages, tax, rent, loan repayments, purchases. Outflows are set against inflows to give net cash flow, and their timing is as important as their size.
In plain terms
Some outflows are fixed and dated — wages, VAT, PAYE — and some are discretionary or negotiable. Understanding which is which lets you smooth cash by timing the flexible ones around the fixed ones.
Why it matters
Managing outflows fairly — taking full supplier terms, timing discretionary spend — keeps cash in the business longer. See supplier payment terms.
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