Cash Flow Forecasts

Cash Flow Forecasts
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Cash Flow Forecast (CFF) models are a very simple way of examining the money money flowing in and out of the business. In effect it will be a way of looking at your business bank balance over say a 12 month period.

CFF are particularly useful for new start up businesses during the first year of business, they will help banks and lenders assess the financial viability of a new business plan.

In the spreadsheet example below, type in a starting business bank balance (your money invested in the business), then enter all the projected bill details you expect to pay and the months you expect to pay them.

In terms of income expect to receive one months sales in the next month (based on your business selling products and services to another business). If you are selling direct to public enter the sales figure for the month it is sold. The spreadsheet model should calculate your cash flow forecast for your first 13 months of operating:

You should now be able to see which months your business will require extra cash injections.

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