Why cashflow forecasting is essential

Why cashflow forecasting is essential

As part of the Cross Group team, we talk to Kiwi business owners every day who are juggling softer sales, rising costs, and a tight lending environment. Confidence may be slowly improving in 2025, but for many small businesses, managing cash remains a daily challenge.

The best way to stay in control? Get clear on your numbers — starting with a detailed cashflow forecast.

What is a cashflow forecast (in plain English)?

It’s a forward-looking plan that shows the cash you expect to receive and pay out over a set period. It helps you see when money will hit your bank account, when it will leave, and where the pressure points might be.

With this visibility, you can act early rather than reacting after the fact.

Why it matters right now

When income is patchy and costs keep climbing, even profitable businesses can run short of cash. A solid forecast helps you spot gaps before they become problems and gives you time to plan solutions.

What a good forecast helps you do

• Avoid financial trouble
  Spot shortfalls early so you can take action — chase payments, reduce costs, or adjust timings.

• Plan for tight spots
  Map out low-cash weeks or months and prepare backup funding if needed.

• Meet tax on time
  Build in GST, PAYE and provisional tax to avoid last-minute stress.

• Time asset purchases
  Decide when it’s best to buy, lease, or hold off based on real cash capacity.

• Assess borrowing decisions
  See how loan repayments affect future cash before you commit.

• Benchmark performance
  Compare actual results with your forecast to fine-tune future planning.

• Test scenarios
  Model different outcomes — price changes, new staff, or slower sales — before making moves.

• Invoice smarter
  Adjust invoice timing, deposits, and terms to smooth out peaks and troughs.

• Support investment or lending discussions
  Provide banks or investors with credible, up-to-date projections.

• Model hiring costs
  Forecast wages, KiwiSaver, and onboarding expenses accurately.

Stay in control of your cash

If cash feels tight or unpredictable, you’re not alone — and you don’t have to face it without a plan. Book some time with the Cross Group team and we’ll help you get detailed with your forecasting, identify the pressure points, and find practical ways to boost inflows and manage outflows.