Understanding Cash Movements

Managing cash is critical to every business and especially to small businesses. Having a plan in the form of a budget or financial forecast is best practice for managing survival and growth. Inadequate cashflow is a symptom of management issues in a business and not the original cause of problems. Having confidence in managing cash and understanding basic cashflow strategies can be of massive benefit to small business owners. 

If you require a cashflow forecast because your bank manager has requested one then we can create one for you. However, there is better value to be had for small business owners when they are directly involved in its creation; to develop understanding around the differences of profit and cash, the cash conversion cycle and managing the various outputs that don't get seen on the profit and loss alone. 

Our Cashflow Management Service

We have two service options. Both include the completion of a cashflow forecast and inputting that data into reporting software on your behalf and in a digestible format, with a review meeting which discusses and signs off the final forecast. The second is in preparing a cashflow forecast for you along with a three hour coaching session to develop the various layers, goals and action plans, followed up by quarterly coaching sessions to help you with your cashflow management and cashflow improvement strategies. 

Why do I need a cashflow forecast?


Predict and Plan

Setting cashflow targets and regularly monitoring your actual cashflow against your forecast will enable you to predict cash outflows, particularly large ones, and respond to changes in your business. Understanding the different rhythms that might be idiosyncratic to your business will allow you to plan ahead.


Monitor Cashflow

Understanding the movement of cash within your business and when you may experience a shortfall ahead of time gives you time to respond. Monitoring the movement of cash and where it might get bottlenecked allows you to improve your processes. 


Get Clarity

Many business owners need more clarity around the nuances of accountancy terms. Making a profit and having cash in the bank can be very different to each other and each with their own impact. Having a space within which to ask and understand these questions and gaining absolute clarity around how the cash moves around your business can be critical to success. 


Updated Yearly

Working on updated figures that are based on what you already know about the business and how it performed in the previous period keeps the numbers relevant and flags up issues that might otherwise remain unseen. Best practise is in having a cashflow forecast drawn up at the beginning of your own financial year.


Constantly Refine

Constantly refining your own understanding, having a mechanism to get direct feedback by way of the numbers and staying ahead of changes in your business will keep you, as a business owner, adapting to inevitable change. Taking the steps to nurture your own financial confidence will allow you to navigate your business well.