A 13-week cash forecast is a week-by-week view of the cash you will have, built from the money you actually expect to arrive and leave. Not profit, not revenue: cash, in the bank, on a given Friday.
It is the forecast banks ask for when a business is under pressure, and the one turnaround advisers build first. It is just as useful when nothing is wrong, because it is the earliest place a tight week shows up.
Why thirteen weeks
Thirteen weeks is one quarter. It is long enough to contain every regular cost a small business has: at least six payroll runs, three rent payments, a quarterly tax instalment and most supplier terms. It is short enough that you can still predict each week with some confidence.
Weekly matters as much as the horizon. A monthly forecast can show a healthy month that hides a Thursday when payroll leaves before the big invoice arrives. Cash problems happen in weeks, not months.
Cash problems happen in weeks, not months. A monthly view can look fine and still hide the Thursday that hurts.
Building one, line by line
You need four things: today’s bank balance, the money you expect in, the money you know goes out, and an honest guess at the rest.
Opening balance. Add up every business account today. Leave out credit lines you have not drawn.
Receipts by expected date. List open invoices by the week you expect payment, not the due date. If a client always pays 20 days late, plan for 20 days late.
Fixed payments. Payroll, rent, loan repayments, subscriptions and tax, each in the week it actually leaves the account.
Variable spending. Suppliers, materials, card spend. Use the weekly average from the last three months as a starting point.
Closing balance. Opening plus receipts minus payments. That closing balance becomes next week’s opening balance.
Week of | Opening | In | Out | Closing |
|---|---|---|---|---|
Oct 6 | $412,380 | $18,600 | $11,450 | $419,530 |
Oct 13 | $419,530 | $9,200 | $44,650 | $384,080 |
Oct 20 | $384,080 | $21,800 | $12,100 | $393,780 |
Oct 27 | $393,780 | $7,400 | $56,280 | $344,900 |
Nov 3 | $344,900 | $24,000 | $13,350 | $355,550 |
Nov 10 | $355,550 | $12,400 | $44,650 | $323,300 |
The first six weeks of a 13-week forecast for a 14-person studio. Week 4 holds payroll and the quarterly tax payment.
Keep it rolling
A 13-week forecast is only useful if it stays thirteen weeks long. Every week, drop the week that just ended, add a new week at the end, and replace last week’s guesses with what really happened.
Then look at the difference. If receipts keep landing a week later than you planned, your collection assumptions are too hopeful. Most forecasts get noticeably better after four or five weeks of this.
Common mistakes
Using invoice due dates instead of expected payment dates. Forgetting annual costs such as insurance renewals. Counting a credit line as cash. Building the forecast once for the bank and never updating it.
Spreadsheet or software
A spreadsheet is a perfectly good place to start, and building one by hand teaches you where your cash really goes. The cost is time: matching actuals every week is the step most owners drop by the second month.
Forecasting software does that matching from your bank feed, which is the main reason to use it. Whichever you choose, the habit matters more than the tool: the same review, the same morning, every week.
Priya Sethi
· Head of Customer Finance
A bookkeeper for more than forty small businesses before Tarn. Runs onboarding and the walkthroughs.
See your own thirteen weeks, built from your real bank balances.
