Why is cash flow forecasting important?

When it comes to future expectations of their profit and loss, in our experience business owners tend to know their business inside and out. They know what margin they will make on each product or service that they offer and have a good understanding of their overheads.

What business owners do not necessarily know inside and out though, is how and when changes (however small) to sales, purchases and other general business costs will affect their bank balance. Whether the impact is positive or negative, the phrase ‘turnover is vanity, profit is sanity and cash is king’ has never been so relevant than to the value of cashflow forecasting.

Helping businesses make better decisions

Good cashflow forecasting starts with GREAT management information. Here’s how we help business owners to develop reliable ‘near real-time’ business data for robust forecasting that feeds better business decisions:

  • We get to know our clients businesses inside out
  • We sit down with them and go through their business and its processes in detail
  • We obtain an understanding of how every single element of the business works together to provide the product/services that the client offers and we analyse how this turns into cash
  • We obtain an understanding from our clients of their future expectations and how they intend to achieve these
  • We will also consider their current reporting to ensure it is useful to management and suggest improvements where necessary

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