Build a short, dated forecast
Start with cash actually available in the bank. For each week, add expected customer receipts and subtract payroll, suppliers, rent, tax payments, existing debt payments and committed project spending. Use collection dates rather than invoice dates. Keep uncertain sales separate from signed orders and collected cash.
Calculate the lowest balance
Illustrative example: opening cash is 12,000, receipts before payroll are 8,000 and payments are 32,000. The projected balance is minus 12,000. If the business also needs a 5,000 operating buffer, the initial gap is 17,000 before financing costs. Repeat this across weeks; adding all monthly expenses together misses the timing that determines the peak shortfall.
Find the cause of the shortage
British Business Bank guidance discusses cash-flow and working-capital funding options including finance linked to invoices and orders. Use the cause of the shortage to narrow the route. Unpaid eligible invoices, stock awaiting sale and a pre-delivery supplier payment are different funding problems.
Source: British Business Bank: cash flow and working capital ↗
- Late receipts: improve collections and examine whether invoice funding fits.
- Seasonal stock: model sell-through, markdowns and the date borrowing can reduce.
- A new order: confirm customer acceptance, supplier terms and delivery risk.
- Recurring losses: revisit pricing, costs or equity needs before adding debt.
Run a downside case you can act on
Delay the largest receipt, lower its amount and include an unexpected essential repair. Add proposed finance payments to both forecasts. Record the trigger for action: for example, a projected balance below the operating buffer two weeks ahead. A forecast is useful when it changes purchase timing, collections or spending decisions—not just when it accompanies an application.
- Update actual receipts and payments every week.
- Reconcile opening cash to the bank balance.
- Do not count a credit limit as cash unless it is available to draw.
Take the next step
Put your proposal beside the cash-flow forecast. Check the net proceeds, payment dates and obligations before deciding.
Examples are hypothetical and use stated assumptions, not provider quotes. Sources describe public information checked on the date above. Availability and terms can change. No independent professional review is claimed.