11. Arrange additional financing before it is needed; for example, seek equity investment through increased memberships if Cash Flow will not safely cover payments.
12. If necessary, sell unproductive assets and discontinue product lines with negative Cash Flow.
� The Benefits of a Cash Flow Forecast
Ensure participants are aware of these: 1. Knowing the available budget
2. Planning ahead for thesocial start up activities
3. Seeing every planned action and transaction. That is, all cash movements in and out of the social start up
4. Providing early warning indicators and serves as a guide to liquidity( cash and assets) 5. Identifying all payments and receipts for a specified period
6. Identifying the opening cash position and net cash position at any point. Please explain that the closing cash position will result from the opening cash position plus the net cash flow position for the period.
7. Identifying responses to respective short or long term positions.
8. Analysing the Cash Flow to identify some critical warning signs to address as quickly as possible. These include but are not limited to: a. Decreased profits despite increased sales b. Declining gross profit c. Consistent decreased Cash Flow d. Reduced market share e. Reduced or increased sales or memberships f. Increased interest payments which outweigh the increase in sales g. Increased overheads h. Not meeting sales forecast on Cash Flowforecast repeatedly
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