How long will your cash last?

Businesses do not close because they lack profit on paper. They close when the cash runs out. This shows how many months yours will last at the rate you are going.

Your numbers

Change in cash each month: -$700.00
Months your cash lasts: 8.6
Extra needed each month to break even: $700.00
Cash in 12 months at this rate: -$2,400.00

At this rate your cash lasts about 8.6 months. You need $700.00 more a month to stop the clock.

The Monthly tab in the kit tracks your cash at the end of every month from your real orders and costs.

See the Back Office Kit, from $19

How the sum works

Change in cash each month = money coming in minus money going out.
Months your cash lasts = cash in the bank divided by the amount you lose each month.
If more comes in than goes out, your cash grows and there is no limit.

Questions

What should I count as money going out?

Everything that leaves the bank in a normal month: stock, materials, postage, fees, software, rent, loan payments and anything you pay yourself.

How much runway should a small business keep?

Enough to cover your slowest season and one large stock order. Many owners aim to keep several months of costs in hand.

My sales are seasonal. Is this still useful?

Yes, but use an average month across the year, then check your slowest months on their own.

This was one sum

The Back Office Kit runs all of them, for every product, together.

One Excel workbook that prices your products, tracks your stock, logs your orders and builds your invoices and wholesale line sheet. One payment of $19. Download the moment you pay.

Get the kit for $19 Watch it work

The dashboard tab of the Back Office Kit: revenue, profit, cash, stock value and items to reorder.

How long will your cash last?

How the sum works

Questions

The Back Office Kit runs all of them, for every product, together.

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