Plan for the months after opening

Build a calendar before a total

Working capital is easier to understand when you put obligations on dates. Payroll, rent, suppliers, loan payments, insurance, and required franchise charges do not necessarily arrive in the same rhythm as customer receipts. A business can have activity and still face a cash shortage.

Make a month-by-month cash forecast with an independent accountant. Show when each receipt is expected to become available, rather than treating every sale as immediate cash. Identify assumptions about opening dates, customer acquisition, collections, and seasonal demand.

Examine the period covered by the FDD estimate

Item 7 includes estimated additional funds for an initial period described in the disclosure. Read the stated duration and assumptions. Do not assume that the estimate promises enough liquidity for your market, your financing structure, or the time needed to reach your own objectives.

Stress the plan in specific ways: a delayed opening, slower receipts, a larger initial inventory requirement, or an unexpected repair. The purpose is to see when cash becomes constrained and which commitments remain due. Avoid describing an untested forecast as a guaranteed break-even point.

Protect the personal side of the plan

Business liquidity and household reserves should be visible separately. If the business cannot support owner distributions as soon as hoped, your household still has obligations. Establish the amount you are prepared to commit and the conditions under which you would seek advice or change course.

Your next research step

• Map cash receipts and payments by month.
• Read the additional-funds assumptions in Item 7.
• Keep a separate reserve plan for household expenses.