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CASHOS WEEK 3: THIS WEEKLY HABIT WILL TRANSFORM YOUR BUSINESS (THE 13-WEEK CASH FLOW FORECAST)
Your Weekly Cash Habit: THE 13-WEEK CASH FLOW FORECASTread on smbfinanceos.com “Wait… we’re short on cash?” Those are momentum-killing words. You’re cruising along… sales are up, customers are happy, your team is buzzing… and then it hits: payroll’s due Friday, and the account’s lighter than expected. Cue stress, credit card transfers, or that awkward vendor call. Surprises like this don’t just hurt your finances. They wreck your confidence. They pull you out of strategy mode and back into survival mode. And if you don’t fix the system that caused the surprise, you’ll find yourself back here again. Today, we fix that. Let me introduce your weekly cash habit: a rhythm that gives you a 13-week view of your cash position. You’ve probably seen this play out:
These moments don’t usually sink the business. But they create chaos and stall momentum. Not because you can’t afford it, but because you lack the confidence to take action… because you’re unsure. And that’s the real cost of surprise: You can’t scale when you’re second-guessing every move. But most of these surprises are predictable. With a few simple habits, you can build a rhythm that allows you to look ahead and start acting with more confidence. THE GOAL: A 13-WEEK CASH FLOW FORECASTYour 13-week forecast is your short-term radar. It shows you what cash is coming in, what’s going out, and whether there’s a storm ahead. Forget five-year projections. This is about surviving and thriving in the next 90 days. You can’t worry about five years if you don’t have the next 90 in check. At its core, the 13-week forecast answers one question: “Are we going to run out of cash in the next 90 days?” If the answer is yes (or even maybe), congratulations!!! You just bought yourself time to fix it. And in business, time is life. That’s the power of the weekly habit. SETTING IT UPPULL OLD DATA (LOOK BACK)There are 4 real numbers we need each week:
We’re not looking at credit cards or invoices or bills. We’re looking at coming in or out of the bank account. This is asking: What actually hit your bank account?
In setting it up for the first time, I like to pull transactions going back as far as I think is manageable. If possible, I go back a year. If that’s too much, start with one quarter. PREDICT THE FUTURE (LOOK AHEAD)Then, we predict what happens going forward. This is simple, but where simple and easy converge. Cash in:
Cash out:
For AR & AP, we want to take into account due dates and historical schedule. If we historically receive a customer’s payment early or late, incorporate that into your prediction. If some AP is pay when paid by the customer, ensure those are aligned. FORECASTED REVENUE The specifics of the business will determine this, but consider booked revenue, contracted, or expected based on historical. We want this to align with any annual forecasting we did, but stay conservative. Remember: payment comes after invoicing. So the payment will lag compared to your annual forecast. Forecasted revenue (or invoicing) for February likely won’t get paid until March, April, or May depending on your terms. Take this into account on your forecast. EXPECTED EXPENSES These are any planned or recurring expenses that happen throughout the year. They could be fixed or variable, irregular or regular. All should be accounted for. Remember: you’re not worried about all transactions, only those that hit the bank. So if you have a bunch of credit card charges, you’re only recording the payment. This will be harder to predict, but looking at historical charges you can generally get a ballpark. You will also generally know the payment 30 or so days in advance. Examples of expenses you could see are:
This is why I encourage you to look a year back. It helps highlight the ebb and flow through the year. Dealing with your recorded expenses and AP can be a bit confusing because some AP could be accounted for in your recurring expenses. Ensure that you have a method to remove duplicate transactions. YOUR WEEKLY RHYTHMFor your cash flow forecast to work, you need to pick a day and time you’ll do each week. Same day (and time) every week. Yes, sure, in reality you can deviate. But I’ve seen it before… deviate too much and then you quit doing it. A weekly habit helps ensure it gets done. I like Monday or Tuesday mornings because it sets the tone for the week. Some do Fridays, but I find I’m too often gone or less focused then, and less likely to get it done. Make a ritual of it. Turn on some music, close the door, and vibe on your cash ritual. The process itself is three steps:
Rinse. Repeat. PULL LAST WEEK’S ACTUALS
As you do this, ask:
COMPARE FORECAST VS REALITYCompare what you thought would happen to what actually happened. This is where the magic is. Did a customer pay faster than expected? Great. adjust next month’s forecast. Did an expense hit earlier than planned? Good to know. The art and science comes in knowing how to react to the differences. That customer paying early… should we adjust next month’s forecast? Maybe or maybe not. These are answers you can only get through reps. Each week your forecast gets better because you’re refining your instincts. REFORECAST THE NEXT 13 WEEKSYou’ve taken note of the changes in the last two steps, so now you’re updating “the future.” Ask:
Document your changes so that when the actual week comes, you can know if your prediction was right. This is key, but often overlooked. OTHER TIPSGIVE IT TIMEIt’s going to be painful at first. It’s going to take too much time. But give it a month and see how much progress you’ve made. Honestly, to lock in your forecasting, you’ll likely need a full quarter. Things ebb and flow in a way you would have had a hard time understanding previously. But in the long term, this data is invaluable and will make you an exponentially better business owner. KEEP IT SIMPLEDon’t try and start with a huge spreadsheet that’s hard to maintain. It’s better to have clarity then 100% certainty. Remember, ultimately, you need to know:
You can always make it prettier later. Clarity first. Fancy later. DON’T HESITATE TO GET GRANULARYou’ll start to learn that different customers, vendors, etc have different tendencies. As you do, it’s natural to start splitting things out. That’s fine and good. Just make sure you DOCUMENT the why with each of those changes. Your future self, or the person you assign it to later, will appreciate that context. UNDERSTAND THE PRECISION LEVELS BY WEEKThe further out you forecast, the less precise it will be. Weeks 1-4 → Aim for accuracy. Weeks 5-8 → Best reasonable estimate. Weeks 9-13 → Directional guess. That’s why this is a weekly habit. Every week you update real data, fix the timing, and adjust. VALIDATE YOUR PREDICTIONS VERSUS HISTORICALIt’s easy for your forecast to either overpredict or underpredict cash in or cash out. Look through your data on both a granular and wide scale. Ensure that your expense forecast aligns with your annual expected spending. I’ve seen what looked like “good” 13-week cash flows be wildly off when doing this type of review. Every quarter or so, check back in and validate that everything aligns. NEXT STEPSThis week start the habit. This habit is foundational to CashOS. When you start doing it, you’ll see unlocks in ways you didn’t know possible:
So, this week, start the journey:
It won’t be perfect or pretty. But over time, it will change everything. Want a dead-simple 13-week cash forecast template to get started? Reply and answer "What’s the hardest part about managing cash in your business right now?" I’ll send it your way. Thanks for reading–see you next week, Work with meNeed more than this newsletter? You may not know, I have other ways we can work together. Check them out:
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