Separate timing from performance.
A margin issue needs pricing, cost, mix, or delivery action. A timing issue needs billing, collections, terms, WIP, inventory, or payment planning. Good working capital review keeps those stories separate.
Cash Flow Resource
Working capital forecasting calculator by industry.
Compare how construction, manufacturing, professional services, distribution, healthcare, and SaaS businesses should forecast AR, inventory, WIP, payables, and cash thresholds.
Construction WIP
Manufacturing inventory
Services receivables
Forecast Builder
Start with an industry pattern, then adjust the assumptions.
Use this as a directional management model. Replace the preset days with your own AR aging, inventory, WIP, payable, billing, and cash forecast assumptions.
USD per month; must be greater than zero
USD per month; use zero if not applicable
Days sales outstanding (DSO)
Days inventory or WIP on hand
Days payable outstanding (DPO)
Weeks of estimated weekly cash costs
Directional management tool · reviewed August 11, 2026. This is not an audit, valuation, solvency test, credit decision, or professional opinion. Validate assumptions against source reports and a 13-week cash forecast before acting.
Methodology, formulas, assumptions, and pressure-score thresholds
Operating working capital = estimated accounts receivable + estimated inventory/WIP - estimated accounts payable. AR uses monthly revenue ÷ 30 × collection days; inventory/WIP and payables use monthly direct cost ÷ 30 × their respective days. Cash conversion days = collection days + inventory/WIP days - payable days. Minimum cash cushion = estimated weekly cash cost × cash-coverage weeks; weekly cash cost estimates direct cost plus 45% of non-direct-cost revenue, divided by 4.33.
- Operating cycle: 0 points at 40 days or less; 1 at 41-60; 2 above 60.
- Capital intensity: 0 points at 75% or less of monthly revenue; 1 above 75%-115%; 2 above 115%.
- Direct-cost load: 0 points at 70% or less of revenue; 1 above 70%-85%; 2 above 85%.
- Cash coverage: 0 points at 5 weeks or more; 1 from 3 to under 5; 2 below 3.
Industry Pressure Map
Do not use the same working capital forecast for every business model.
The math is similar, but the assumptions and management actions are different.
| Industry | Cash gets trapped in | Forecast should watch | Best monthly question | Likely TruePoint path |
|---|---|---|---|---|
| Construction and trades | WIP, retainage, unapproved change orders, slow progress billing | Billings ahead or behind production, retainage release dates, subcontractor payments, payroll, change-order status | Will the next jobs require more cash before existing work converts? | Intelligence Pro or advisory when WIP data needs ownership |
| Manufacturing | Raw materials, WIP, finished goods, customer receivables, purchase commitments | DIO, DSO, vendor terms, backlog, production schedule, slow-moving inventory, material cost changes | Are purchases and production building cash pressure before sales collect? | Intelligence Pro for forecast visibility; advisory for inventory and margin discipline |
| Professional services | Unbilled work, retainers consumed too quickly, receivables, write-offs, payroll timing | Utilization, realization, billing cycle time, AR aging, retainer coverage, staffing commitments | Is profitable work becoming cash before payroll and hiring commitments arrive? | Intelligence when project data is clean; advisory when pricing or staffing decisions are material |
| Distribution | Inventory, receivables, supplier minimums, freight, customer terms | Inventory turns, fill rate, margin by SKU or customer, DSO, DPO, purchasing commitments | Which inventory and customer terms are funding growth, and which are absorbing cash? | Intelligence Pro for margin and cash visibility |
| Healthcare | Insurance receivables, denials, provider payroll, patient collections, billing lag | AR by payer, denial rate, provider productivity, payroll coverage, patient balances, cash runway | Are revenue-cycle delays or provider capacity creating the cash low point? | Intelligence Pro or advisory when revenue-cycle timing needs a management cadence |
| Technology and SaaS | Annual contracts, deferred revenue, payroll, customer acquisition, implementation costs | Burn, runway, ARR quality, churn, CAC payback, hiring plan, billing terms, deferred revenue obligations | Does the runway support the next hiring, product, and sales commitments? | Intelligence Pro for KPI and runway reporting; advisory for capital planning |
Forecast Design
Build the forecast around decisions, not just formulas.
Name the operating owner.
Receivables, change orders, inventory, billing approvals, payer denials, and purchase commitments need owners. A forecast without ownership becomes a spreadsheet instead of a management system.
Connect the low point to action.
The forecast should explain whether to accelerate collections, delay spending, revise hiring, adjust purchasing, negotiate terms, use financing, or schedule a leadership consultation.
QuickBooks, Sage, and accounting systems record and report financial activity. TruePoint interprets that information, identifies risks and opportunities, and explains what management should do next. For the broader buying decision, compare financial intelligence software vs. advisory support.
Decision Path
Match the next step to the risk and data quality.
Software is useful when the data is current enough to interpret. Advisory is better when the business needs human ownership over the finance rhythm.
TruePoint Intelligence
Best when books are reasonably current and leadership wants monthly plain-English interpretation of financial risks, opportunities, and next actions.
TruePoint Intelligence Pro
Best when working capital needs cash forecasting, scenarios, custom KPIs, and quarterly planning without a full advisory engagement yet.
TruePoint Advisory
Best when the company needs controller, FP&A, financial operations, or CFO-level leadership. Advisory clients automatically receive Intelligence Pro.
Related Resources
Use the industry view with the deeper guides.
Operating Working Capital Analytics
Estimate how AR, inventory, WIP, payables, margin, and growth assumptions affect cash pressure and the next management action.
Working Capital Forecasting Worksheet
Turn AR, inventory, WIP, payables, weekly cash costs, and cash thresholds into a first-pass management readout.
Working Capital Guide
Understand why profit and cash diverge when operating assets and obligations move.
Cash Conversion Cycle Guide
See how long cash stays tied up before sales convert back into usable cash.
Distribution Finance Guide
Connect inventory turns, customer terms, supplier terms, margin leakage, and cash forecast decisions.
Construction Finance Guide
Connect job costing, WIP, retainage, change orders, working capital, and cash forecasting.
Manufacturing Finance Guide
Connect margin, inventory, receivables, payables, working capital, cash forecasting, and KPI decisions.
Professional Services Project Profitability
Connect utilization, realization, project margin, receivables, staffing, and cash decisions.
Law Firm Matter Profitability Dashboard
Connect WIP, AR, realization, retainers, matter margin, and partner actions to cash forecasting.
Need a working capital forecast leadership can act on?
Start online with TruePoint Intelligence Pro for forecasting and custom KPI visibility, or schedule a consultation when the business needs controller, FP&A, financial operations, or CFO-level support.