Cash is the lifeblood of your company. Needless to say, managing your cash and keeping positive cash flow should be a priority. Imagine being a dispensary, processor, or cultivator that doesn’t have enough cash on hand to pay for new product shipments, pay employees and contractors, or worse pay your taxes.

So how do you make sure you are correctly managing your cash flow?


Solution: Weekly cash flow forecasting

A quality forecast is used to show whether your company has or will have enough cash to pay bills, pay lenders, pay employees in the short or long term. It uses past and present data to estimate timing and the flow of cash in and out of your company.

                                                                                                                                                                                                        A weekly cash flow forecast will drastically increase your ability to foresee negative cash balances before they happen, allowing you to make the necessary adjustments to prevent them. The idea of a weekly cash flow forecast sounds good, but there important factors that must be addressed in order to have a useful forecast.


Keys to a useful cash flow forecast are:

  • Accurate accounting records
  • Understanding of current market and business environment
  • Analysis of how long it takes for customers to pay invoices (less important for retail dispensaries)
  • Accurate recording and consideration of due dates for bills and expenses
  • Create weekly, monthly, and annual forecasts


Benefits of a weekly cash flow forecast

We’ve discussed how a cash flow can help prevent negative cash balances, but another major benefit of cash flow forecasting is using it to understand growth potential for your company. Do you have excess cash each week? Are you making another profits each month that will allow for another dispensary location, another employee, another grow facility?

                                                                                                                                                                                                         A cash flow forecast can save your business and keep it afloat during down times. It can also help you thrive and grow. In cannabis, it can help you operate correctly and make sure taxes and all compliance related expenses always taken care of. It is a key to cash management.


Need help with your cash forecasting?

Setup a free consultation here and unlock your positive cash flow potential.