Cash Flow
The movement of money into and out of the business over time. A profitable Amazon business can still run short of cash because costs are paid long before sales are paid out.
What Is Cash Flow?
Cash flow is the timing of money coming in and going out. Profit tells you whether a sale was worth making; cash flow tells you whether you can pay for the next order of inventory.
Why Amazon Sellers Feel It
- You pay first - suppliers and freight are usually paid weeks or months before the stock is sellable
- Amazon pays later - sales are disbursed on a settlement cycle, and part of the balance can be held in reserve
- Growth makes it worse - a fast-growing product needs a bigger order each time, funded by the smaller sales of the previous cycle
Cash Flow vs Profit
A product can be profitable on every unit and still drain the bank account while you scale it. That is why sellers track a cash position and a forecast of upcoming payouts and payments alongside the P&L.
How SellerLegend Helps
SellerLegend's cash flow ledger combines Amazon settlements with your manual entries for outside expenses, keeps a running balance, and links Amazon payouts to the settlements behind them.
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