FUNDINGFOCUS Plan it right Hitachi Capital Franchise Finance on the cashflow forecast
pressure off your business in the short term and make it easier to grow. Understanding your future cash position helps
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you to make better decisions about funding and how to grow your business – essential if you wish to expand via multiple sites, buy more stock, or take on extra staff. A good forecast also helps you understand whether you’ve enough money coming in to cover your overheads and pay staff and suppliers. If you don’t, you can’t pay your bills on time – this affects your credit ratings and could very well mean the end of your business. Every business is different but each is dependent on the activity of its creditors and debtors, and it’s
good cashflow forecast is a valuable tool. But how do you plan ahead if you’re just starting out? And how do you create a forecast that’s useful? Successful planning can take the
important to strike a healthy balance between the two. If you’re paid late by a customer, or have to settle an invoice early, or too much money is taken out of the business, it may become vulnerable. Low cash levels means extra pressure for you to deal with. The answer is to project your cashflow and predict any preventative action you can take. This is called cashflow forecasting. The simplest way to proceed is to set up a 13-week cashflow forecast.
Your 13-week cashflow – how and why For this, you’ll need to reconcile what’s coming in and going out regularly. A 13-week period accounts for just over a quarter or a season in calendar terms. It’s also the usual length of time used by accountants, investors and lenders to assess if a small business has a positive outlook for its cashflow.
Supporting your franchising ambitions
Services provided by an award-winning team with over 40 years experience.
• Business planning • Start up and working capital loans • Equipment finance • Business training services • Multi-unit financing
01844 355575
hitachicapital.co.uk/franchise-finance
Hitachi Capital Franchise Finance is a trading style of Hitachi Capital (UK) PLC. Authorised and regulated by the Financial Conduct Authority. Finance is provided by Hitachi Capital (UK) PLC. Hitachi Capital Franchise Finance also offer credit broking services, and may introduce you to a selected panel of third party lenders. Office Address: Beacon House, Stokenchurch Business Park, Ibstone Road, Stokenchurch, Bucks, HP14 3WN. T: 01844 355575
www.hitachicapital.co.uk/franchise-finance Registered Office: Hitachi Capital House, Thorpe Road, Staines-Upon-Thames, Surrey TW18 3HP. Registered in Cardiff under companyno. 1630491
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