What a thirteen-week cash forecast is, why it beats an annual budget for day-to-day decisions, and how to build one.
An annual budget tells you where you hoped to be. A thirteen-week cash forecast tells you whether you can make payroll in eight weeks’ time. For most small businesses, the second question matters more.
Why thirteen weeks
A quarter is long enough to see trouble coming and short enough to forecast with confidence. Weekly columns catch the lumpy things a monthly view hides: quarterly VAT, rent days, a big customer who always pays on the 28th.
Start from actuals
Build the first version from the last twelve months of real transactions, not from the budget. Group money in and money out into a handful of lines you understand. Ten lines beat a hundred.
Add what you know
Layer on the things you already know: a hire starting in November, a price rise in January, a supplier moving to shorter terms. Keep each one as a separate scenario so you can switch it on and off.
Compare every month
At each month-end, put the forecast beside what happened. Where it was wrong, find the assumption that caused the miss and change it. Over a few months the forecast earns its trust.
Share the runway, not the spreadsheet
Your board needs one chart and three sentences: cash today, cash at the low point, and what you will do if the low point comes early.