List what you have to pay once to get started and what you will pay every month, say how many months you want to be able to run before the business covers itself, and the calculator shows the cash you need. Change the starting figures to your own, then print the budget sheet or copy it.
One-off costs are a wall you have to climb before the first customer arrives. Equipment, deposits, branding and opening stock all have to be paid for up front, so they decide how much you must raise or save before you start. They are also the costs you can most easily shop around for, borrow against or delay.
Monthly costs are a rate, not a wall. They decide how long the cash you have will last. A business with small one-off costs and large monthly costs can look cheap to start and still run out of money quickly, which is why this calculator treats the two lists separately and adds them back together at the end.
Runway is the number of months you can pay your costs while revenue is still catching up. Most new businesses take longer to reach steady sales than their owners expect, so three to six months is a common minimum and twelve is more comfortable. Pick the number that matches how fast your customers can realistically find you.
The expected revenue box lets you test the plan. Enter the revenue you hope for, then a lower number, then zero. If the cash needed with zero revenue is far beyond what you have, you know which costs to cut, which launch to stage, or whether to start part-time. The printed sheet gives you one page to show a partner, a lender or yourself next month.
Add up everything you pay once before you open (one-off costs), then work out your monthly costs and subtract the revenue you expect. If monthly costs are higher than revenue, that gap multiplied by the months you want covered is the running cash. Cash needed is the one-off costs plus that running cash, plus any buffer.
One-off costs of $8,900, monthly costs of $2,730 and expected revenue of $1,500 leave a gap of $1,230 a month. Over 6 months that is $7,380, so the cash before a buffer is $8,900 + $7,380 = $16,280. A 10% buffer adds $1,628, giving $17,908.
Anything you pay once before or at the start: registration and licenses, equipment, a website, branding, a deposit, the first batch of stock and set-up fees for lawyers or accountants. Costs that repeat every month go in the monthly list.
The running cash is then zero, because the business covers itself from the start in this simple model. The cash needed is just the one-off costs plus the buffer. In practice revenue is slow to arrive, so try a lower figure too.
No. It is a simple estimate from the numbers you enter, with flat costs and flat revenue, and it is not professional financial advice. Seasonality, tax, loan repayments and growth are not included, so check your plan with an accountant before you borrow or invest.
Related: Business plan template, Break-even calculator, Burn rate calculator.
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