Profit is an opinion; cash is a fact. A 13-week cash flow forecast is the single most useful tool for an owner-led business — long enough to see trouble coming, short enough to stay accurate. Here's how to build one that takes 20 minutes a week to maintain.
The structure
One column per week, 13 weeks out. Five sections of rows:
- Starting cash — actual bank balances at the start of each week.
- Cash in — collections from existing AR (by expected week, not invoice date), recurring revenue, and new sales you're confident about. Be pessimistic here.
- Cash out — fixed — payroll, rent, insurance, loan payments, software. These are known; schedule them on the week they actually hit.
- Cash out — variable — inventory, contractors, marketing, owner draws, tax payments.
- Ending cash — starting cash + in − out. This row is the whole point: find the lowest week and manage toward it.
Rules that keep it honest
- Use receipt dates, not due dates. If clients pay Net-30 invoices in 45 days, forecast 45.
- Put payroll on the correct weeks. Two-payroll months vs. three-payroll months is the #1 forecast miss.
- Schedule taxes like bills. Quarterly estimates, sales tax, and payroll taxes go on their real due dates.
- Update weekly, not monthly. Replace week 1 with actuals, add a new week 13, adjust what changed. Twenty minutes.
Reading it
- Lowest ending balance — your real constraint. If it's negative, you now have weeks to fix it: accelerate collections, delay a purchase, or draw on a line of credit calmly instead of desperately.
- Trend — is ending cash growing or shrinking quarter over quarter? That's the business telling you the truth.
- Owner draws — the forecast shows what the business can actually support, not what the P&L implies.
Want this built for you — connected to your actual AR, payroll calendar, and tax schedule? That's part of our Growth and Finance Department engagements at Lemoti.