Quick answer
Start with the available opening cash, add receipts expected to clear each week and subtract payments due in that week. Carry the closing balance forward. Update it with actual figures regularly, and test a less favourable sales or payment scenario so a comfortable monthly total does not hide a shortfall mid-month.
Choose a useful period and a reliable starting balance
Use a period that covers the gap between paying for stock and receiving the associated cash, plus known major bills. Weekly columns are often practical for a small shop; when money is tight, the exact dates inside a week matter too.
British Business Bank's forecasting guidance focuses on when cash is received and paid. Begin with a reconciled balance and identify cash already committed or restricted. Do not count an unapproved loan, an expected grant or a hoped-for supplier credit as available cash.
Further reading: British Business Bank: Creating a cash flow forecast
List receipts by settlement date
Separate cash takings, card settlements, customer invoice payments and other receipts. A card sale on one day may reach the bank later. Use your actual provider timetable, including weekends and holidays, rather than assuming sales and receipts happen together.
Keep owner funding or borrowing on separate rows from sales. That prevents a cash injection from disguising weak trading. Use realistic sales assumptions from comparable periods, and mark any receipt that is uncertain so it can be tested separately.
Put payments in the week they are due
Include stock, wages, rent, utilities, subscriptions, loan payments, tax payments and owner withdrawals as applicable. Use the actual payment amounts for a cash forecast; this is different from deciding which costs belong in a profit calculation.
In this original example, the shop begins week one with £2,000, receives £3,600 and pays £4,300, leaving £1,300. Week two receives £3,200 and pays £4,700, leaving a £200 shortfall. A positive total sales figure would not make that second week affordable.
| Cash movement | Week 1 | Week 2 |
|---|---|---|
| Opening balance | £2,000 | £1,300 |
| Receipts clearing | £3,600 | £3,200 |
| Payments due | £4,300 | £4,700 |
| Closing balance | £1,300 | −£200 |
Test the assumptions before deciding
What happens if receipts are lower, a settlement is delayed or an essential repair bill arrives? Change one assumption at a time and note which week becomes difficult. Do not disguise the gap by moving a payment date unless the other party has actually agreed.
Use the forecast to start specific conversations early: query an unexplained bill, review discretionary spending or discuss timing with your accountant and supplier. If you may be unable to meet obligations, seek appropriate professional help promptly rather than relying on an optimistic spreadsheet.
Weekly cash review Opening balance checked against: Receipts that changed: Payments that changed: Lowest expected balance and date: Uncertain assumptions: Action, owner and deadline:
Replace predictions with actuals
At each review, enter what cleared, explain the main differences and roll the forecast forward. Preserve a copy of the old forecast if you want to see whether your assumptions are improving. A forecast that is never updated quickly becomes a record of intentions.
Keep the task manageable: focus first on the largest cash movements and the earliest potential shortfall. The purpose is to help you make decisions in time, not to predict every small purchase perfectly. Operational records can explain a change, but your bank and accounting records remain the financial source of truth.
Unpickle can help the team record deliveries and stock work that informs purchasing decisions. Build and maintain the cash forecast in your accounting tool or spreadsheet. Keep stock and delivery follow-up organised.