Cash flow forecasting

Why is cash flow important to your business? 

  • Identifies potential shortfalls with your cash position and provides advance warning to take action
  • Ensures the business can pay its suppliers and employees. Suppliers can suspend supplies and services if not paid
  • Highlights problems with customers not paying – it encourages business to review their credit control procedures and implement tighter controls
  • Important for external stakeholders, banks and investors. Banks may require regular forecasts in the event of a loan being secured

How a good cash flow forecast can benefit your business 

It is important to note that whilst increased sales are good they do come with additional costs, materials, labour, resources, premises which can all reduce your cash flow. Sales are tomorrows cash inflows – ‘a sales is not a sale until it is paid for’ So how does a cash flow forecast assist?

You can produce multiple forecasts for different scenarios to assess how each scenario impacts on your cash flow. You can factor in new product, potential large orders and changes in the current business model or market. This provides a realistic forecast on how these factors will impact on your cash position and whether you can fulfil them without over trading. It also provides you with an essential document that assists your cash management and maintains your finances in a controlled environment and provides reassurances with forward planning.

Since engaging Denise to run our finances she has also helped with cash flow models giving us more understanding of our companies financial situation and releasing Directors to focus more on running the business efficiently.

Dell Freeborn, Bricklayers Ltd

Cashflow Ebook

Download our E-Book

Download our useful E-Book “The Importance of Cash Flow Forecasting and Management” to get Denise’s top tips on how to manage your cash.


Don’t rely on the bank balance as your key indicator

Cash flow forecasting and management is a key aspect of financial management of any business planning and its future cash requirements to avoid cash flow difficulties. From experience too many businesses just rely on their bank balances to gauge their cash flow position and then realise too late that they cannot meet their liabilities or overlook provisions for tax liabilities. Cash flow forecasting and management is essential to your business future – are you devoting the time to your cash position and your finances, is it becoming too much and overwhelming?

If the answer to these are YES and you need extra support please contact Denise for a free consultation on how she can support you and your business.