Bookkeeping for contractors and service businesses in MetroWest and Greater Boston.

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How do I create a cash flow forecast?

A cash flow forecast projects your future cash position by estimating when money comes in and when it goes out. It’s different from your profit and loss statement. P&L shows revenue and expenses when earned or incurred. Cash flow tracks when money actually moves through your bank account.

Start with your current bank balance. That’s your baseline. Then list expected inflows over the coming weeks, including customer payments based on your AR aging, expected deposits, and any recurring revenue. Be conservative here. If your average customer pays in 45 days, don’t project they’ll suddenly pay in 15.

Next, list your expected outflows. Start with fixed expenses you know are coming, such as payroll, rent, insurance premiums, loan payments, and estimated taxes. Then add variable costs like vendor bills, materials, and subcontractors. The more thorough you are on the outflow side, the fewer surprises you’ll face.

Most small businesses use a 13-week rolling forecast. Thirteen weeks gives you enough runway to see problems coming while staying close enough to forecast with reasonable accuracy. Each week, update actuals for the prior week, adjust your projections, and add a new week at the end. Working with local bookkeepers who understand your business can help you build and maintain this rhythm without adding to your workload.

The format can be simple. A spreadsheet works fine for most businesses. Rows for each inflow and outflow category, columns for each week, with a running cash balance at the bottom. You’re watching for weeks where the balance drops too low or goes negative. Those are the warning signs you want to catch early.

For contractors and project-based businesses, tie your forecast to job schedules. When do you expect progress payments? When are material purchases due? When are subs getting paid? Matching cash movements to project timelines gives you much better visibility than general estimates.

The common mistake is building a forecast once and never touching it again. A forecast from two months ago doesn’t help you today. Weekly updates take about fifteen minutes and keep the projection useful. Our cash flow planning service includes weekly updates, variance tracking, and scenario testing so you can see what changed and plan accordingly.

The point isn’t perfect prediction. It’s seeing potential problems early enough to act. A good forecast tells you in week two that week seven looks tight. That gives you five weeks to speed up collections, delay a purchase, or arrange a credit line before you actually need it.

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More Questions

How do I track subcontractor expenses by project?

Link every sub invoice to a specific job or project in your accounting system. Require subs to include the job name or number on their invoices, enter costs with the project code attached, and reconcile against your estimates regularly.

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What's the best bookkeeping software for contractors?

QuickBooks Online or Desktop handles most contractor needs when configured properly for job costing. Construction-specific software like Buildertrend makes sense for larger operations with complex scheduling and customer communication needs.

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How do I find a contractor bookkeeper in Massachusetts?

Look for referrals from other contractors, check the QuickBooks ProAdvisor directory, and ask specific questions about job costing experience. A bookkeeper without construction experience won't give you the job-level visibility you need.

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What's the best accounting software for restaurants?

QuickBooks Online is the standard for restaurants. But the software matters less than how well it integrates with your POS system and whether it's configured for restaurant operations.

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Should I outsource payroll or do it myself?

It depends on how many employees you have, how complex your pay structure is, and how much your time is worth. Most small business owners underestimate the compliance burden of DIY payroll until they get hit with a penalty.

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How much does a bookkeeper cost for a small business?

Small business bookkeeping typically costs $200 to $600 per month for basic services. Actual pricing depends on transaction volume, how many accounts need reconciling, and whether your industry requires specialized accounting like job costing.

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Full-service bookkeeping firm serving contractors and small businesses in MetroWest and Greater Boston. From monthly bookkeeping to job costing and payroll, we bring 20 years of hands-on business experience to your back office. Locally owned in Bellingham, Massachusetts.

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