7 ways to improve cash flow in your business (2026)

Cash is the lifeblood of your business. When it flows freely, you can pay your team, invest in growth and navigate unexpected challenges confidently. However, if the money runs dry, even the most profitable business can be brought to halt. 

With the arrival of Payday Super on 1 July 2026, cash flow management has stepped further into the spotlight. The new rules mean super contributions will now leave your account every pay cycle, not every quarter, removing the cash flow buffer many businesses have previously counted on.

Instead of viewing this shift as a setback, use it as your sign to modernise your processes. Sharpen your forecasting, overhaul your processes and set your business up for a stronger, more agile financial future.

This article takes a look at practical strategies to help you optimise your cash flow and build a resilient foundation for long-term success, especially under the Payday Super reform. Let’s get started. 

Understanding cash flow basics

Before we dive into strategies, let’s get back to basics. Cash flow is the net amount of cash moving into and out of your business.

Importantly, a business can be profitable on paper but still fail due to poor cash flow. This happens when your outflows are required sooner than your inflows arrive, creating a cash gap. Managing this gap is the essence of cash flow management.

The impact of Payday Super on cash flow

The shift from quarterly to payday superannuation has the ability to fundamentally restructure business liquidity. Instead of managing a large, predictable outflow once every three months, you’ll be required to navigate smaller, frequent payments every pay run.

While the total annual super liability remains the same, the timing changes everything. Under the rules prior to 1 July 2026, the quarterly cycle acted as a financial buffer, giving businesses breathing room to manage expenses and forecast capital. From 1 July 2026, that buffer disappears. 

The scale of this shift is significant with recent Employment Hero financial modelling showing that the average small business will need to unlock an extra $124,000 in additional working capital just to stay compliant. This makes precise cash flow forecasting and automated payroll more critical than ever before.

Understand the financial impact of Payday Super on your business cash flow calculator

The first step in preparing for Payday Super is understanding its precise impact on your business. How much cash will you need on hand for each pay cycle? 

Using a purpose-built tool like our Payday Super Cash Flow Calculator can remove the uncertainty. Simply fill out the details and you can project exactly how much cash you’ll need to cover your weekly, fortnightly or monthly super liabilities. 

Seven strategies to improve cash flow

This legislative change is an opportunity for smarter financial management. It’s time to move beyond reactive measures and implement proactive strategies that protect your liquidity and empower your growth. Here’s seven ways you can take control of your cash flow. 

Speed up your accounts receivable

The fastest way to improve your cash flow is to get money into your bank account sooner. The longer your invoices go unpaid, the more strain you put on your own ability to pay bills. It’s time to tighten up your collections process.

• Automate invoice reminders: Chasing late payments manually is a time-consuming task. Use your accounting software to set up automated reminders that are sent when an invoice is due or overdue.
• Shorten payment terms: For new clients, consider implementing shorter payment terms, such as net 15 instead of net 30.
• Offer early payment discounts: Encourage prompt payment by offering a small discount (e.g. 2% off) for clients who pay within 10 days. The cost of the discount is often less than the cost of a cash flow crunch.

Renegotiate supplier payment terms

Just as you want to get paid faster, you want to hold onto your cash longer. This involves managing your accounts payable. Reach out to your key suppliers and discuss the possibility of extending your payment terms. Moving from a net 30 to a net 45 or net 60 agreement can significantly improve your cash position. 

The key is to approach this as a partnership. Explain that you’re working to align your payments with your own revenue cycle, reinforcing that you’re a reliable, long-term customer.

Implement rolling cash flow forecasting

An annual budget is no longer enough. To stay agile, you need a near-term view of your finances. This can be done by implementing a rolling 12-week cash flow forecast. Think of this as a living document that projects your cash inflows and outflows over the next three months.

By connecting your accounting software with forecasting tools, you can automate much of this process. A rolling forecast helps you spot potential cash shortages before they become a crisis, giving you time to arrange a line of credit, chase receivables more aggressively, or delay a non-essential purchase. Don’t wait for a problem; anticipate it.

Optimise inventory and clear old stock

For many businesses, inventory is cash sitting on a shelf. Tying up too much working capital in unsold goods can be a major drain on your liquidity. Regularly analyse your inventory turnover to identify slow-moving or old stock. Run a sale, bundle products together or offer special promotions to turn that idle stock back into cash.

Audit and reduce operational overheads

Small, recurring expenses can drain your cash reserves over time. Conduct a regular audit of your operational overheads to find these cash leaks. Scrutinise every line item, including:

• Unused software subscriptions
• Underutilised services
• Utility providers (can you get a better rate?)
• Office supplies and other miscellaneous costs

Trimming these unnecessary expenses can free up a surprising amount of cash that can be better used elsewhere in the business.

Adjust your pricing strategy to protect profit margins

With rising costs across the board, maintaining static pricing is a recipe for shrinking margins and declining cash flow. When your supplier costs, shipping fees and labour expenses go up, your prices must reflect that reality. Regularly review your pricing strategy to make sure it not only covers your costs, but also protects your profit margin.

Streamline workforce management and payroll costs

Your wage bill is likely one of your largest and most complex cash outflows. Streamlining payroll is a powerful way to improve cash flow and reduce risk. Manual processes, spreadsheets and outdated systems are prone to human error, which can lead to costly back payments and non-deductible penalties from the ATO, such as the Super Guarantee Charge (SGC).

Automating your payroll with a platform like Employment Hero can greatly reduce these risks. It gives you confidence with calculations, helps you stay across changing legislation and provides a clear, real-time view of your labour costs. This level of control and accuracy is fundamental to effective cash flow management.

Take control of your cash flow and future proof your payroll today

Relying on manual spreadsheets and fragmented systems puts your business at risk. It’s time to adopt a smarter, more integrated approach to managing your finances and your people.

Payday Super will be here before you know it. Start preparing now by understanding its impact on your business. Use our Payday Super Cash Flow Calculator to get a clear picture of your future liabilities and download our Payday Super Cash Flow Checklist to guide your strategy.

To make the transition to Payday Super as easy as possible for you, we’ve developed HeroClear; an automated clearing solution embedded directly into Employment Hero payroll that validates and pays super in near real-time. 

If you’d like to learn how Employment Hero can support your business, get in touch with one of our business specialists today.

Disclaimer: The information in this article is current as at 5 March 2026, and has been prepared by Employment Hero Pty Ltd (ABN 11 160 047 709) and its related bodies corporate (Employment Hero). The views expressed in this article are general information only, are provided in good faith to assist employers and their employees, and should not be relied on as professional advice. The Information is based on data supplied by third parties. While such data is believed to be accurate, it has not been independently verified and no warranties are given that it is complete, accurate, up to date or fit for the purpose for which it is required. Employment Hero does not accept responsibility for any inaccuracy in such data and is not liable for any loss or damages arising either directly or indirectly as a result of reliance on, use of or inability to use any information provided in this article. You should undertake your own research and to seek professional advice before making any decisions or relying on the information in this article.