The Top 3 Advantages Of Implementing A 13-Week Cash Forecast - A Navera Group News Article


The Top 3 Advantages Of Implementing A 13-Week Cash Forecast

Added on September 5, 2018

Cash is the lifeblood of every business. It does not matter if your company is large or small, growing or declining, for profit or non-profit. As the old saying goes, “cash is king.” While a growing business should consider whether or not they have enough cash to support growth plans, a declining business must improve cash flow in order to survive. Cash management is crucial for the overall health of any organization however, far too many business owners and management teams fail to properly forecast cash flow.

They are often surprised when there is not enough money in the bank to meet payroll and stay current with other operating expenses. A 13-week cash forecast is a method to accurately estimate the cash flow needs of your company. Although it is typically used in organizations that are on the decline or have complicated cash cycles, this powerful tool can help any business. The following information will provide you with the top three advantages of implementing a 13-week cash forecast.

The 13-Week Cash Forecast Paints Both A Short And Long Term Picture

The time frame of the 13-week cash forecast is short enough to support swift decision-making and also long enough to drive decisions that need to be made in the near future. In essence, it provides a balance between accuracy and range. It is a well-known fact that the accuracy of a forecast decreases the further it extends into the future. 13 weeks provides just enough time to have a positive impact on longer-term strategic decision making, while remaining short-term enough to be materially accurate. 

The 13-Week Cash Forecast Allows You To Plan For The Medium Term Without Disrupting Strategies For The Longer Term

A 13-week projection is the perfect time frame to provide CFOs and other financial management team leaders with the information that is needed to make medium term cash flow plans. This may include short-term investments, repayment of debt, capital expenditures and other financial based decisions. While 13 weeks is sufficient for month-to month and medium-term planning, longer term planning can remain with the organization’s overall business planning process.

The 13-Week Cash Forecast Provides Liquidity Risk Forecasting

Thirteen weeks is a long enough period of time to identify potential liquidity issues that may arise. It also provides enough time to prepare for and act upon those issues in order to resolve the problem before it becomes a crisis. Having a clear sense of the amount of working capital that the business has access to provides an added motivation to generate revenue, and collect receivables from both current and past due accounts. It also provides the business with visibility to its capacity to borrow money on its revolving line of credit.

In conclusion, the 13-week cash forecast arms your organization with information that is needed to make crucial business decisions. The insights that it provides not only helps improve cash flow; it may also make the difference between success and failure. Navera Group is a cash management specialist that provides solutions to clients in all stages including strong balance sheets and declining revenue positions. 

Our team of experts will work hand in hand with your leadership team to ensure the best overall outcome for your company. If you have any questions, or would like more general information about our array of services, please contact us today.  Phone: 617-356-7516; Email:; Website: