http://www.streetsmartmethods.com - Maintaining good cash flow is vital for any small businesses. To really understand its role, think of cash on hand as s small business’ vital fluids—the more cash on hand it has, the more ‘liquid’ a small business becomes. A favorable liquidity level means the business is able to settle the current portion of its obligations when they become due, thus allowing for smoother operations. Good cash flow simply means the business is able to maintain adequate cash on hand.