Profitable sales can arrive too late to pay a supplier. A 13-week cash forecast shows when money is expected to enter and leave the bank. Use it alongside profit and margin reporting when deciding whether to order stock, increase advertising or fund a launch.
Build the weekly model
- Start with available bank cash. Keep platform reserves and undrawn credit separate.
- List known receipts and payments by expected bank date, not order or invoice date.
- Use each platform’s actual payout schedule and known holds.
- Roll closing cash into next week’s opening cash.
- Refresh weekly: replace estimates with actuals, explain differences and add a new week at the end.
| Illustrative week | Cash |
|---|---|
| Opening bank balance | £10,000 |
| Expected net platform deposits | £8,000 |
| Supplier payments | £9,000 |
| Payroll and overheads | £4,000 |
| Tax payment | £2,000 |
| Closing bank balance | £3,000 |
If the £8,000 deposit is delayed a week, this example instead closes at minus £5,000. That identifies a funding or timing decision before the payment is due. A forecast does not guarantee receipts or access to credit.
Avoid double-counting cash flows
If forecast receipts are net platform payouts, do not deduct the same platform fees again as bank payments. Model separately paid advertising and subscriptions. Identify stock deposits, final supplier balances, freight, duty, taxes, payroll, debt repayments and owner withdrawals. Use your actual filing and payment dates for tax.
Plan stock and seasonal demand
Map the time between the supplier deposit, goods arriving, customer sales, payout and returns. For example, a September purchase might not generate bank receipts until November or December. Put the actual purchase-order terms and settlement assumptions into the forecast rather than using one platform-wide delay for every seller.
Track slow stock, minimum order quantities and the cash committed to the next batch. Inventory and landed-cost accounting supports margin decisions; the forecast separately shows when those costs are paid.
Stress-test growth before committing
- Lower sales or a weaker contribution margin after advertising, fees and returns.
- Longer payout holds or a spike in refunds after peak season.
- A supplier requiring a larger deposit or earlier final payment.
- Foreign-currency purchases becoming more expensive in GBP.
- A new channel needing setup spend before it generates usable cash.
Set a minimum cash buffer and identify when a decision must be made. Options may include revising the launch, smaller stock orders, negotiated supplier terms or a separately assessed financing arrangement. Avoid replacing a cash forecast with a revenue growth target.
Compare financing on the agreement, not the headline rate
For a loan, revenue-based arrangement, invoice facility or equity investment, compare total cost, repayment timing, guarantees, security, covenants and control implications. A fixed fee or factor rate is not automatically comparable with an APR. Product terms vary: do not assume every platform advance has the same cost or no guarantee.
Show proceeds and repayments separately from trading sales. Confirm the accounting classification from the contract; a financing receipt is not automatically revenue and every deduction from a payout is not automatically interest. Reflect the cash effect of repayments in both base and downside scenarios.
Use reporting to decide what to scale
Monitor contribution after product costs, fulfilment, returns and marketing alongside cash. Revenue divided by advertising spend does not itself prove profitability. For an expansion or funding application, keep reconciled accounts, forecasts, stock records and the underlying assumptions together. See financial reporting for online businesses.
An accountant can help reconcile the starting position, challenge assumptions and compare scenarios. Agree forecasting or advisory work explicitly alongside monthly bookkeeping; see pricing and scope.
Specialist E-commerce Accountants
General information for UK online sellers. Your accounting and tax treatment depends on your circumstances; confirm the approach for your business before acting.