A cash flow forecast is a helpful financial planning tool that will help you estimate the amount of cash that will be flowing in and out of your business over time. It gives you a projection of how changes in your business activities and environment, such as sales, expenses, busy and slow periods, will impact your business’s cash position now and in the future.

You can anticipate periods of high or low cash availability and create realistic budgets, set financial goals, and avoid overspending. You will be able to identify cash shortfalls in advance and take proactive measures to combat them. You will also get a clear picture of your business’s financial health and it will provide a good measure to review against in the future. Best of all, with a cash flow forecast, you can make more informed decisions about your business based on its cash position.