Apparel Business Cash Flow Model Creation

Cash Flow forecast excel – Developer Brief (Points 1–8)
1. Business Context
• We operate as both a manufacturer and a retailer of apparel.
• The business manufactures garments internally and also outsources production where capacity is constrained.
• Sales are made through wholesale channels and through our own retail stores.
• The tool must support an integrated view of manufacturing, procurement, sales, and cash flow.
2. Financial Budgets
• Approved financial budgets exist for the full 2026 financial year.
• Budgets include revenue, cost of goods sold, and operating expenses.
• Budgets must be uploadable or input into the model and remain editable for scenario planning.
• The system must differentiate between fixed and variable costs.
3. Operating Expenses (OPEX)
• OPEX budgets are clearly defined on a monthly basis.
• These include rent, salaries, utilities, marketing, admin, and other overheads.
• OPEX is treated as a fixed monthly cash outflow in the cash flow model.
• The tool must allow OPEX changes to be simulated.
4. Sales & Unit Planning
• Exact unit sales targets are defined per category and per style.
• Retail and wholesale sales volumes may vary month-to-month due to seasonality.
• The system must allocate unit sales across months based on an input sales curve.
• Sales volumes must directly drive production and procurement requirements.
5. Fabrics & Suppliers
• Garments are produced using multiple fabric types.
• Each fabric supplier has different pricing, lead times, and payment terms.
• Fabric orders must be linked to the styles they support.
• The system must calculate fabric requirements based on unit volumes and consumption rates.
6. In-House Manufacturing
• Certain garments are manufactured internally.
• In-house production has a lead time of approximately 12–14 weeks.
• Factory overheads are fixed and must be allocated based on production volume.
• The system must calculate when production must start based on required delivery dates.
7. Outsourced Manufacturing
• Where in-house capacity is insufficient, garments are outsourced to external manufacturers.
• Outsourced production is priced per unit with agreed lead times.
• Each supplier may have different payment terms.
• Outsourced production costs must be scheduled accurately in the cash flow.
8. Pricing & VAT
• Wholesale prices are generally calculated as cost × 2 (100% markup).
• Retail prices are generally wholesale × 2.
• VAT is charged at 15% on all wholesale and retail sales.
• The system must track VAT output, VAT input, and net VAT payable.