Why do individuals struggle to complete a cash-flow forecast template? Is it because they are in a hurry to get the business started that they don’t see the point in completing one? Or could it be that they don’t understand how to put one together?
I recently helped someone with their cash-flow forecast. I asked several questions to help them understand their intended business. As it would only operate on a seasonal basis, I explained why it would be in their best interest to complete a cash-flow forecast before starting the business.
What else should you consider?
Competition, competition, competition! It’s important to study what they do, as this can offer you a wealth of information, especially if you haven’t completed your cash-flow forecast. Use what you learn to help you create your unique selling proposition (USP), focus on the mistakes that they have made, but most of all consider joint initiatives, which would work for both of you in the long term.
I'd suggest that you spend the time and do the maths on your cash-flow to gain a clearer understanding of what the numbers mean. In addition, it will be useful to do a sales forecast to break-down your income on a monthly basis. If this feels tricky you may want to ask a business adviser to break it down for you.
Once you understand the importance of this document, you will begin to embrace figures, gain confidence and get excited about your future business endeavours.
It can make your business life much easier, if you learn to embrace it.
"Entry costs are very low and straightaway you have a very wide marketplace at your fingertips.