EBITDA is a useful number. It is not the number that keeps the lights on. Suppliers, payroll, freight, and the bank are all paid in cash, on their schedule, not in profit that is still tied up in inventory or sitting in receivables.
A growing product business can be profitable and short of cash at the same time, because growth ties cash up before it frees it. You buy the inventory now and sell it later. You ship to the account now and collect in sixty or ninety days. You hold safety stock for a channel that pays slowly. On paper the business is winning. In the account, it is tight, and getting tighter the faster it grows.
This is why cash timing belongs in every growth decision, not just the year-end review. Before the bigger order, the new channel, the larger customer, the questions are not only “is it profitable” but “when do we pay, when do we get paid, and what has to be funded in between.” A healthy margin with a broken cash cycle still breaks the business.
Run the business on cash and let EBITDA be the scorecard it is. Owners who watch the cash cycle as closely as the profit line are the ones who get to keep growing. The others find out the hard way that the page and the bank account were never the same thing.