The impact of COVID-19 on businesses has been substantial and it has upturned the notion of “business as usual.” Many business owners have found that forecasting cash flow has helped them anticipate potential shortfalls and plan accordingly to cover difficult periods.
Cash flow forecasting, even in unusual times, offers your business several advantages. It enables you to avoid making rash decisions and protects your business over the long run. You can make informed business decisions based on the timing of your cash flows and adjust your future working capital needs before you actually need the funds. You can determine what credit terms to offer to customers, based on their payment history. As you identify and address late-paying customers, you can take action to obtain customer payments in a timely manner.