Switchback Spring, June 16-18, 2026 in New Orleans, LA
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Switchback at TRE, December 1-3, 2026 in San Antonio, TX
Outside, it’s a bluebird day with a warm breeze. Inside the store, the staff is digging into a fresh shipment of daypacks, and the season is off to a promising start. At first glance, the shop looks successful—margins are strong, and the sales floor buzzes with hikers prepping to head for the peaks. Yet, when it’s time to run payroll or settle with a vendor, the bank account tells a much bleaker story.
This is the “cash flow gap” many outdoor specialty retailers face. “They look profitable on paper, and yet month to month, they seem to always still be struggling with cash,” says Jacob Curtis, CPA and owner of Curtis Accounting Solutions.
According to Curtis, the problem often isn’t a lack of sales, but rather a breakdown in inventory timing. In an industry where specialized products often have longer sales cycles, but bills come due in thirty days, the disconnect between sales and cash flow quickly becomes a major risk. Working with a financial expert to create proactive forecasting can help retailers bridge this gap and align cash flow with sales success.
For years, Curtis has helped retailers solve the “cash flow gap,” where stores enjoy strong sales but struggle to pay the bills. Early in his career, Curtis worked in accounting for a $400 million company, but after its acquisition, he joined the small-business world, starting with his mother’s specialty fabric and quilting shop. Since then, he has built a client base of about 40 businesses, including outdoor specialty stores. He sought out these retailers to combine his career with his passion for hiking, mountain biking, and whitewater rafting. Now, he uses straightforward planning tools to help business owners operate more effectively.
One example involved a single-location, 3,500-square-foot retail shop with about $1.5 million in annual revenue. On paper, the business was profitable with healthy margins, yet the owners felt constant financial pressure as their bank account was often empty.
When Curtis dug into the numbers, he found the problem wasn’t sales, but a timing mismatch in the inventory cycle. The store’s products sat on the shelves for an average of four months before selling, turning over only three times per year. Meanwhile, vendors required payment within 30 to 45 days. This meant the store was paying for products months before receiving cash from sales, creating a persistent, stressful cash-flow gap and tying up significant capital on the shelves.
To help the store find its footing, Curtis moved the owners away from a reactive management style and into a more proactive one. The first step in this transition was a move toward forecasting. While many struggling retailers manage their business by looking at the past—specifically by reviewing Profit and Loss (P&L) statements to see what happened last month—Curtis shifted the focus to the future. By using historical trends to project what the coming months would look like in terms of sales and cash flow, the owners could stop guessing based on gut feelings. Instead, they had a data-driven prediction of exactly how much money would be in the bank when the next vendor’s bill arrived.
Once that forecast was in place, Curtis introduced a formal inventory budget to act as a roadmap for spending. This budget determined their open-to-buy amount, letting the owners know exactly what they could afford to purchase at any given time based on their projected sales. It’s a process Curtis uses for all his clients, providing them with specialized, custom-built forecasting tools that translate complex accounting metrics into easily digestible information. This deliberate, straightforward approach ensured the store never overbought or tied up cash in products that would sit on the shelf for months.
By aligning every purchase with a clear view of future cash, the store doubled its inventory turnover, reaching nearly six turns annually. Strictly following this budget shortened the shop’s cash cycle, ensuring sales revenue returned to the bank before the next bill was due. This shift effectively closed the timing gap that had been draining cash resources.
While having a robust forecast and a solid inventory budget are essential, bridging the gap between sales and cash flow also requires a fundamental shift in how many retailers think about their business.
According to Curtis, the most successful shops move beyond a passive approach and make every business decision with a clear purpose. “You have to be intentional,” Curtis says. “If you’re not intentional, how do you know where to go?”
This intentionality is most visible in how high-performing stores manage their inventory. Rather than buying based on excitement or “good deals,” they are incredibly selective. Curtis points to one successful retailer who operates by a strict “80% confidence” rule. “I won’t buy anything if I’m less than 80% confident I can sell it within two months,” the owner told him.
Curtis notes that top-tier retailers treat every order as a strategic investment in their cash flow rather than an emotional choice. He points out that retailers must address a common psychological hurdle: unrealistic optimism. Many owners operate on the hopeful assumption that a large, exciting order will naturally translate into success.
“So many stores are so hopeful that they get this big order, and it seems like it’s going to be a great deal,” Curtis explains. “And then it sits on the shelf for six months, and they’ve already paid for it three or four times over because of inventory carrying costs and everything else.” Moving past this wishful buying requires a mental shift toward being more calculative, where every purchase is backed by data rather than just a positive feeling.
Curtis adds that successful retailers also recognize they can’t be experts in everything. While many shop owners try to wear every hat, Curtis advises them to have a “board of directors” and surround themselves with specialists. By relying on experts in finance, marketing, and other aspects of the business, these retailers free themselves up to lead their teams and focus on other critical operational issues.
For decades, outdoor specialty retailers didn’t need to operate so meticulously. They thrived by relying on intuition, but today’s business climate is much more competitive and less forgiving. Unpredictable cash flow now collides with a litany of rising expenses—from rent and insurance to higher wages—leaving almost no room for mistakes.
“The margin of error is getting smaller and smaller,” says Curtis. “So, retailers have to be more and more careful in how they’re spending their money.”
These days, even a successful season can be derailed by “hidden” factors like the instability in global shipping. Sudden tariffs or surcharges can appear between the time an order is placed and when it ships, effectively doubling the price of a product. To handle this, Curtis has his clients build a safety net directly into their projections. By factoring in a 5 to 10 percent buffer, owners ensure they have a dedicated cash reserve to absorb these inventory surprises without derailing their operations.
While these technical buffers provide a necessary safety net, they represent a larger shift in how a shop must operate. Longevity in today’s market depends on more than just strong sales or a well-curated floor; it requires building a strategic framework where cash flow actually matches business needs.
Ultimately, this is about moving past a “gut feeling” and leaning into the numbers to protect the heart of the shop. As Curtis says: “Cash flow is the lifeblood of any retail business. Without it, you can’t pay your bills, you can’t buy inventory, and you certainly can’t grow.”
Don’t miss the Switchback Spring session, “From Cash Chaos to Confident Growth: A Profit System for Outdoor Specialty Retailers,” featuring Jacob Curtis. He’ll provide attendees with a practical profit and cash planning framework to help them identify margin and inventory pressure points in their current business model.
Click here to learn more about Switchback Spring and register today.
