NHPA’s Newest Educational Program Covers Cash Flow Conundrums

This fall, the North American Hardware and Paint Association (NHPA) will launch a new educational program, which will guide retailers through managing cash flow to support growth and success. The classes will be led by Kim Peffley, NHPA’s director of organizational development and consulting, and Brian Young, small business consultant. Read their conversation here to learn what retailers will gain from the program and visit YourNHPA.org/cash-flow to learn more.

Kim Peffley (KP): Tell us a little bit about your history in the hardware industry.
Brian Young (BY): My parents owned a small hardware and feed store in upstate New York. My grandpa bought the business in 1957, and my dad took it over in the 70s. When my family considered closing their business, I came back from college and took over. In 2009, I won the NHPA Young Retailer of the Year award, which inspired me to open up more stores. In 2023, I sold my store to my family, retaining some stock in the company. I’m now consulting with small businesses, showing them how to Scale Up (their revenue) and Scale Out (cut their weekly hours) so they can reinvest their time into family, community and planning their operation’s future.

KP: Why is cash flow a big issue for retailers?
BY: We, as business owners, get all-consumed with the daily issues, problems, opportunities—the shiny things. Money doesn’t actually talk. It’s quiet. It’s not shouting at us and vying for our attention like our customers, employees, managers or others can be. Cash flow will quietly shrink up on us and then when January, February or March rolls around, when our bank account is really bleeding, we notice. Here’s the problem—90% of small businesses that fail do so because of cash flow issues. When we have cash flow problems, not only can it be tough to pay bills, but we stop planning and expanding our businesses and go into survival mode.

We circle the wagons and focus on just the essentials, and this is never good. We then get stressed, pessimistic and can forget what we’re truly wanting to accomplish with our stores and our big goal of who we want to touch and how.

KP: What can an overwhelmed store owner do to manage cash flow for growth?
BY: Start with these three steps. First, recognize that cash flow is not a once a year issue. It culminates usually at one time (during the slow season), but it isn’t at that time only. It is an issue that can and should be looked at monthly or at least quarterly. The problem in most people’s minds is that there isn’t an easy way to keep an eye on cash flow.

Next, find someone to look over the cash flow numbers with you. Having another person who can hold you accountable will go a long way. They can be—but don’t have to be—good with numbers. Just giving attention to your cash flow at all will have a massive impact. Schedule your cash flow meetings for regular intervals, once a month for one hour. Make it a fun time; do it over coffee or a meal and away from the store. If you enjoy it, you’ll keep doing it.

Finally, set two goals. After you’ve had a few meetings with your CFC (Cash Flow Confidant), start setting a financial goal of where you want your numbers to be in three months, six months, one year and two years. Then—this is the really fun part—set one or two goals of what you want to do with your soon-to-be excess cash.

For more information on this program starting in October visit YourNHPA.org/cash-flow.