# Cash Planning
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**Quick Answer:** Cash planning maps your replenishment decisions to your cash position — showing you what to buy, when to order, and exactly when cash leaves your account. It turns reactive purchasing into a forward-looking, budget-aware process. Mo can build a prioritised plan for you in minutes when you give it a budget.
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**Cash planning for inventory** means aligning your purchasing and production decisions with your actual cash position and forecast. Rather than placing orders reactively — when stock runs out or a supplier follows up — cash planning gives you a forward-looking view of what you need to buy, when, and how much it will cost.
For inventory-based businesses, cash planning answers questions like:
* How much cash will I need to replenish stock over the next 30, 60, and 90 days?
* When do my largest purchase order outflows hit, and do I have coverage?
* What happens to my cash position if demand comes in higher — or lower — than expected?
* Which SKUs are tying up the most working capital relative to their sell-through?
***
## Why Is Cash Planning Important?
Inventory decisions are financial decisions. Every purchase order you place is cash leaving your business. Every unit sitting in a warehouse is working capital that could be deployed elsewhere.
The two failure modes look like this:
* **Too little stock** → stockouts, lost revenue, and customers who don't come back
* **Too much stock** → cash tied up, storage costs climbing, and markdowns eating your margin
Most brands experience both at different times — because traditional planning approaches rely on historical averages and manual judgment, which break down under real-world volatility.
### Benefits of Structured Cash Planning
* Prevents reactive, last-minute purchasing that often costs more
* Reduces excess inventory and the working capital tied up in it
* Creates alignment between your operations and finance teams
* Gives you the data to negotiate better payment terms with suppliers
* Makes it easier to plan around large seasonal orders or MOQ opportunities
### Who on Your Team Benefits
| Role | How it helps |
| ----------------------------- | --------------------------------------------------------------- |
| **Founder / CEO** | Clear visibility into cash commitments before they happen |
| **Operations / Supply Chain** | Prioritised replenishment decisions grounded in real data |
| **Finance / CFO** | Reliable outflow forecast to manage runway and working capital |
| **Sales / Marketing** | Confidence that inventory will be in stock to support campaigns |
***
## What Makes a Good Cash Plan?
A good cash plan isn't just a list of SKUs to reorder — it's a structured view of what needs to be purchased, when payment is due, and what the cumulative cash impact looks like over time.
### Key Fields and Data Points
A solid cash plan should include the following at minimum:
| Field | Why it matters |
| ------------------------- | -------------------------------------------------------------------------------------------------- |
| **SKU / Product name** | The unit of planning — never plan at the category level only |
| **On-hand inventory** | Your starting point; must reflect current warehouse stock |
| **Forecasted demand** | Units expected to sell over the planning period |
| **Weeks of Supply (WOS)** | How long current stock will last at forecasted demand |
| **Reorder quantity** | Units needed to reach your target stock level |
| **Unit cost (COGS)** | Cost per unit, used to calculate total cash outflow |
| **Total PO value** | The combined purchase cost across your reorder quantity — your total cash commitment per line item |
| **Lead time** | How long until stock arrives after ordering |
| **Order date** | When the PO needs to be placed to arrive in time |
| **Payment due date** | When cash actually leaves your account (affected by payment terms) |
| **Supplier** | Who you're ordering from; helps group POs and plan outreach |
### What Good Formatting Looks Like
* **Plan at the SKU level**, not just by product line or category. Aggregated views can mask imbalances — some SKUs may be critically low while others are overstocked.
* **Use a rolling time horizon** — typically 30/60/90 days — so you're always looking forward, not just at what's immediately urgent.
* **Show cumulative cash outflow** alongside individual PO values so you can see the total impact of your plan at a glance.
* **Group by supplier** when reviewing for approval or outreach, so you can consolidate orders and minimise freight.
### Common Gotchas
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**Bundles and components aren't automatically accounted for.** If you sell bundles, the cash impact of restocking them depends on the component SKUs, not just the bundle itself. Make sure your plan accounts for component-level inventory and cost — otherwise you may underestimate your true cash need.
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**Lead times are often longer than quoted.** Suppliers tend to quote best-case lead times. Build in buffer, especially for international suppliers or around peak seasons (Q4, Chinese New Year, etc.). A plan built on optimistic lead times will create stockouts even when it looks healthy on paper.
**Payment terms shift when cash actually leaves.** Net 30 or Net 60 payment terms mean the cash outflow doesn't happen when you place the PO — it happens later. Make sure your plan reflects actual payment dates, not order dates, so you don't misread your cash position.
**Seasonal demand spikes aren't always in the forecast.** If a major promotion, retailer launch, or seasonal push isn't factored into your forecast, replenishment recommendations will underestimate what you actually need. Always layer in known events before running a cash plan.
**Overreliance on category-level averages.** Planning at the brand or category level hides the individual SKU stories. A category with a "healthy" average WOS might still contain SKUs heading toward a stockout next week.
***
## How Do I Build a Cash Plan?
**Time Required:** 30–60 minutes (initial setup) **Difficulty:** Intermediate
A good cash plan is built from four inputs: your current inventory position, your forecast, your cost data, and your supplier terms. Here's how they come together:
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### Start with your forecast
You need a forward-looking demand estimate at the SKU level. This is the foundation — everything else is derived from it.
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### Calculate your current Weeks of Supply (WOS)
For each SKU, determine how long current stock will last at your forecasted sell rate. This is your depletion timeline — the foundation for identifying what needs to be ordered and when.
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### Identify reorder needs
For any SKU where WOS falls below your target (accounting for lead time and safety stock), calculate the quantity needed to get back to your target level.
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### Apply unit costs
Convert reorder quantities into cash values using your COGS per unit. This gives you the total purchase cost for each SKU — your actual cash commitment per order.
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### Map to order and payment dates
Factor in lead times to determine when each PO needs to be placed. Then apply your payment terms to understand when cash actually leaves your account.
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### Prioritise against your budget
If total replenishment needs exceed available cash, rank SKUs by urgency (stockout risk, revenue contribution) and allocate budget accordingly.
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***
## How Do I Build a Cash Plan with Mo in Moselle?
**Time Required:** 5–10 minutes **Difficulty:** Beginner
Mo can do most of the heavy lifting for you — pulling your live inventory data, applying your forecast, and building a prioritised replenishment plan based on a budget you define. Cash planning with Mo happens in the same conversation as your regular planning workflow; there's no separate tool to open.
### What Do I Need Before Building a Cash Plan with Mo?
Make sure the following are in place before asking Mo to build a cash plan:
* [ ] **Forecast is active and up to date.** Mo builds recommendations from your demand forecast. A stale or uncalibrated forecast leads to a misaligned plan. Make sure your forecast reflects current trends, any known promotions, and seasonal factors.
* [ ] **Lead times are configured.** Mo uses lead times to calculate urgency. If lead times aren't set, Mo can't accurately determine when you need to order.
* [ ] **Safety stock is set.** Your safety stock settings define the minimum inventory floor Mo plans around. Without them, Mo may underestimate how much you need to order.
* [ ] **COGS / unit costs are accurate.** For Mo to calculate the cash value of a replenishment plan, product costs need to reflect what you're actually paying.
### Step-by-Step: Getting a Cash Plan from Mo
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### Give Mo your budget
Tell Mo the dollar amount you have available to spend on replenishment. Be specific — this number will anchor everything Mo recommends.
> **Example prompt:** "I have a budget of $15,000 for replenishment this month. Can you help me build a purchase plan that stays within that budget and prioritises the SKUs most at risk of stocking out?"
Mo will pull your current inventory levels and forecasted demand to begin building a prioritised plan.
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### Review the prioritised recommendations
Mo will return a recommended set of purchase orders ranked by urgency. Expect to see:
* SKUs surfaced by stockout risk and sales velocity
* Units and estimated cost per SKU based on your forecast and target WOS
* A running total so you can see how your budget is being allocated
* Any SKUs approaching stockout that may warrant urgent attention
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### Adjust and refine
Cash planning is rarely a one-shot process. Once Mo returns its initial recommendations, iterate with follow-up prompts.
> **Example prompt:** "That looks good — can you also include lower-priority SKUs if there's budget remaining after covering the most urgent ones? Keep the total under $15,000."
> **Example prompt:** "Remove SKU XYZ-001 from the plan — we have a shipment arriving next week. What does the remaining budget look like?"
> **Example prompt:** "Which SKUs are at risk of stocking out in the next 4 weeks if I don't order them?"
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### Confirm and export
Once you're satisfied with the plan, Mo can help you finalise your purchase orders or export a summary for review with your team or supplier. Use this as the basis for your actual PO submissions.
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**Save your go-to prompt.** You can save your cash planning prompt as a favourite in Mo so it's ready to run with a single click. See [Save Your Favourite Prompts](/mo/tips/save-favourite-prompts.md) for instructions.
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### What Prompts Work Best for Cash Planning with Mo?
| Use case | Example prompt |
| ----------------------- | ---------------------------------------------------------------------------------------------------------------- |
| **Budget overview** | "I have $20,000 to spend on replenishment. What should I prioritise based on my current inventory and forecast?" |
| **Stockout protection** | "Which of my SKUs will stock out in the next 6 weeks if I don't reorder? How much would it cost to cover them?" |
| **Budget stretch** | "I've covered my most urgent SKUs and have $3,000 remaining. What else should I include in the plan?" |
| **Scenario check** | "If I reduce my replenishment budget to $8,000, which SKUs would I need to cut from the plan?" |
| **Refine the plan** | "Remove SKU XYZ-001 — we have stock arriving. What does the remaining budget look like?" |
| **Supplier grouping** | "Group the replenishment plan by supplier so I can see which POs to send to each vendor." |
| **Cash timing** | "What's my total procurement commitment for the next 60 days based on my current replenishment plan?" |
| **Deferred spend** | "Which orders could I push without risking a stockout, if I need to free up cash this month?" |
***
## Frequently Asked Questions
Do I need to set up anything in Moselle before using Mo for cash planning?
Yes — at minimum, you need an active forecast, lead times configured, and safety stock set for your key SKUs. Without these, Mo's recommendations will be less accurate. COGS / unit costs should also be up to date so Mo can calculate the cash value of each replenishment.
What if my total replenishment needs are higher than my budget?
That's exactly what Mo is designed for. Give Mo your budget and it will prioritise SKUs by urgency — surfacing the highest-risk items first so you can make the most of available cash. You can then decide whether to defer lower-priority SKUs or explore adjusting order quantities to stay within budget.
How often should I run a cash plan?
Weekly or bi-weekly is ideal for most brands. A plan built at the start of the month may not reflect new orders placed, incoming shipments, sales spikes, or slow periods since then. Running it regularly keeps your purchasing decisions aligned with reality.
Can Mo account for bundles in a cash plan?
Mo can work with your bundle and component setup in Moselle. For the plan to reflect true cash needs, your BOMs (bills of materials) should be configured so Mo can trace bundle demand down to the component SKUs that actually need to be purchased.
Can I use Mo for production planning as well as replenishment?
Yes. Mo supports both finished goods replenishment and production run planning. If you manufacture or co-manufacture products, Mo can factor in production lead times, component availability, and run sizing as part of a budget-aware plan.
What's the difference between a cash plan and a production plan?
A replenishment plan focuses on purchasing finished goods from a supplier. A production plan focuses on scheduling manufacturing runs, which involves both timing and component inputs. Mo can help you build both — and in many cases, they're connected.
***
## Related Guides
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[Planning with Mo](/planning-and-execution/replenishment/production-planning-with-mo.md)
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[Replenishment](/planning-and-execution/replenishment.md)
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{% content-ref url="/pages/5l1isZUpoJlB9dV2sixp" %}
[Forecasting](/planning-and-execution/forecasting.md)
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{% content-ref url="/pages/c3H9nIfH0qdJQffJKIWc" %}
[Generate Orders](/planning-and-execution/replenishment/generate-orders.md)
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