Cash flow management: Assessing cash flow

Tourism HR
  • Budget & Finance
  • Respond

Preparing a cash flow budget

When a crisis happens, you need to ensure your financial response matches the scale of the impact and takes into consideration the potential medium and long-term consequences for your business. This is where a budget comes in handy, as it represents the future activities of your business in financial terms and covers all functional areas such as marketing, IT, human resources, and operations. 

A cash flow budget is a planning exercise that tracks the money flowing into and out of your business on a monthly basis, revealing shortfalls and potential problem areas in advance. While it requires some upfront work, getting into a regular cash flow budgeting and monitoring process can help you survive this crisis and even emerge stronger on the other side. Here are the components and steps involved in preparing a cash flow budget:

Intelligence from your tourism industry association, destination marketing organization, regional tourism organization, provincial marketing organization and other tourism operators in your community can help you estimate your monthly sales and income during different scenarios (reopening, ramp up, and low period).

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