Cash Planning And Forecasting

New Business Tool Kit

The lifeblood of any business is its ability to collect cash and pay bills, as well as pay its employees, particularly its owners. Far too often small businesses are profitable, but they do not have enough operating capital to meet their current needs. Consequently, they may be forced to sell out to a stronger competitor, sell a portion of the company to investors at an undesirable price, or close the doors and put the company out of business. None of these alternatives is typically what the owners expected when starting the business. To try and compensate for this it is important that all business owners have a plan for their cash by preparing a cash forecast.