summerize into bullet points>>>>> Cash flow forecasting for small businessesTo run a successful business, good cash flow management is crucial. Cash flow forecasting can help with that.A desktop computer featuring accounting software, on a desk with lamp, coffee cup, pencils and pot plant.What is a cash flow forecast?Cash flow forecasting is a method of predicting cash inflows and outflows to see how much money you’ll have in the future. It gives a good glimpse into your business's financial health and can help plan spending.A cash flow forecast is different from a cash flow statement. A statement focuses on past cash flows, a forecast aims to predict the future.Why is cash flow forecasting important?Staying on top of your business cash flow helps you pay bills on time and it helps ensure you can pay yourself, too. When costs are rising, it becomes even more imperative that businesses get their cash flow management right, and cash flow forecasting is one way to do it.Benefits of a cash flow forecastCash flow forecasting is a good financial habit to get into. It has multiple operational and financial benefits for your business, including:spotting cash shortages and giving you time to work on contingency plans, whether that’s delaying spending, requesting extra credit from suppliers, or securing a business loanassessing the affordability of your growth plans – for example, they can show if there’s going to be enough money to buy new tools, or to hire a new employeeensuring you will have enough money to pay you, the business owner!identifying quickly if expenses are climbing or income is slumpinghighlighting fixable cash flow problems such as slow-paying customers, impractical payment terms, seasonal cycles, or over-reliance on high-cost financeWhat are the key components of a cash flow forecast?Your cash flow forecast will show a few key aspects of your business' finances. These are:starting position (cash in the bank)expected cash in (hopefully mostly from sales but may also be from loans or sales of assets)expected cash outnet cash flow, which shows if cash reserves have grown or shrunkclosing balanceWho is responsible for doing a cash flow forecast?Lots of small business owners do their own cash flow forecasts. They can use a spreadsheet or accounting software to do it. But plenty of others rely on a bookkeeper or accountant. They’re able to do them quite quickly because they really know their way around small business cash flow.How to do a cash flow forecastTo do a cash flow forecast, you estimate the size and ti Wrap the entire output in JSON format.
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