Cash flow refers to the net amount of cash being transferred into and out of a business. Positive cash flow is crucial for meeting obligations and investing in growth, as it ensures that the company has enough liquidity to pay its bills, salaries, and other expenses on time. It also enables the business to take advantage of new opportunities, such as expanding operations, purchasing new equipment, or entering new markets. Effective cash flow management involves forecasting future cash needs, optimizing the timing of cash inflows and outflows, and maintaining a buffer to handle unexpected expenses. Positive cash flow enhances financial stability, supports strategic planning, and contributes to the overall long-term success of the business.