Calculator
Cash flow & reorder planner
Undercapitalisation is usually a timing problem, not a budget problem. This shows you where the gap falls.
Your numbers
Result
Why the gap exists
Money leaves on the purchase order. It does not start coming back until goods have been produced, shipped, received, listed, sold, cleared the return window and reached a settlement payout. In between, your capital is inventory sitting in a warehouse.
The trap is that your best product creates the worst version of this problem. A product that sells quickly needs reordering while the first order's money is still in transit back to you. Sellers routinely go out of stock on their winner, lose rank, and pay in advertising to rebuild what they lost.
A worked example
A first order of 500 units at $6.20 landed, on 30% deposit and 70% balance, with production and freight taking roughly nine weeks door to fulfilment centre. Selling 12 units a day at $29.99.
| Day | Event | Cash effect |
|---|---|---|
| 0 | Deposit, 30% of $3,100 | −$930 |
| ~35 | Balance on passing inspection | −$2,170 |
| ~40 | Freight, duty and customs | −$900 (illustrative) |
| ~63 | Received and sellable | — |
| ~65 | First sales begin | — |
| ~72 | First payout lands, after DD+7 | first cash back |
| ~105 | Stock at 45 days of cover — reorder point | next deposit due |
The number that matters is the gap between day 0 and day 72: roughly ten weeks with money out and nothing coming back. And the reorder falls due around day 105, while only part of the first order's revenue has returned. That overlap is why the second order is usually funded from savings rather than from sales.
What this planner assumes
- Even sell-through. Real demand is lumpy and seasonal; the output is a floor on the room you need, not a forecast.
- A single order cycle. Overlapping orders — which the fee structure effectively requires — tie up more capital than this shows.
- Payouts arrive on the delivery-date schedule. Account holds, reserves and disputes all push it later, never earlier.
- No peak-season distortion. Q4 raises storage, fulfilment and advertising costs at the same time as it raises revenue.
- Freight and duty are entered as landed figures. An examination hold or a duty rate change lands outside this model.
Three ways to close the gap
- Order smaller and more often. Higher per-unit freight, lower risk, faster cycles. Usually the right trade for a first product.
- Hold a reserve deliberately. Decide the reorder budget before you place the first order, and treat it as unavailable rather than as a buffer you might dip into.
- Negotiate terms. Deposit-and-balance or net terms move the outflow later. Suppliers grant these to buyers with a track record, which is one more reason the second order is easier than the first.
This model assumes even sell-through and a single order cycle. Real demand is lumpy and seasonal. Treat the output as a floor on how much room you need, not a forecast.
The decisions this planner sits inside
- When you actually get paid — funds release seven days after delivery, not after you ship, which is where the last leg of the gap comes from.
- Landed cost — the outflow side of this model, per unit.
- The low-inventory-level fee — the cost of getting the reorder timing wrong in the other direction.
- Peak season — why Q4 is the quarter this gap is most likely to catch you.
Frequently asked
What payout lag should I use?
Use your own observed figure from settlement reports. It should cover the settlement period plus the return window, because money that may still be refunded is not yet yours to spend.
Why does the tool warn me even when I have money left?
Because having cash left is not the same as having enough to reorder. The warning triggers when the reorder falls due before the first payout arrives.
Does this account for advertising spend?
Indirectly, through net profit per unit. Ad spend during launch is front-loaded, so if you are launching a new product, model a lower net profit for the first weeks.