Cash Flow Systems

A simple revenue allocation framework.

Four bank accounts. Two transfer days a month. A system that decides what cash is “available” before you can spend it.

The default trade allocation

Every deposit gets split. On the 10th and the 25th.

01
Profit account: 5%
Off limits. Quarterly distributions only. The reward for the business actually working.
02
Owner’s pay account: 10%
Funds your salary. Predictable paycheck for you regardless of how lumpy the month was.
03
Tax account: 15%
Pays quarterly estimates. You stop borrowing from operating cash on April 15.
04
Operating account: 70%
What’s actually available for the business. Crew, materials, fuel, marketing, software, everything.

Why it works

Trade revenue is lumpy. Discipline can’t be.

Storm work hits and the deposit looks like Christmas. Without forced allocation, owners buy a new chipper in March and starve themselves in February. The system creates artificial scarcity in the operating account so you make hard calls when cash is fat, not when it’s thin.

By the 10th of the month, the money is already gone to other accounts. You cannot overspend on equipment because the cash is not sitting there to overspend with.

Caveat

Percentages have to fit your margins.

A 32% gross margin shop cannot allocate 5% profit plus 10% owner’s pay on day one. The operating account would starve.

Start lower. 2% profit, 3% owner, 15% tax, 80% operating. Run that for 90 days. When operating consistently has a buffer, ratchet profit and owner up by a point at a time. The goal is to grow the allocation as margins grow, not crash the business chasing a textbook split.

Open the accounts at the same bank. Two transfer days a month, on a calendar reminder. The system only works if it’s mechanical.

The bottom line

Decide where the money goes before you see it.

If the deposit hits the operating account whole, it’s already too late. The system has to run on autopilot.