Industry sector: Retail and wholesale

Outdoor equipment shop: Cash sales

'Cash sales' means all income from your main business activity which is received at the time of sale. While some of your customers will pay you in cash, remember that Cash sales can also include:

  • debit and credit card payments, including contactless
  • payments made through online payment services like PayPal
  • cheques, if you decide to accept them (like most retailers, you probably won't take personal cheques but may allow any business customers you have to pay you in this way)

To prepare your cash flow, you need to estimate how much income you will receive over the next twelve months, including VAT. To do this you will need to work out how many items you are likely to sell, at what price and when you will receive the money. You will also need to decide if you will offer any additional services and what you will charge for them if you do.

There are a number of things to consider when you make your estimates:

Type of business

  • who will your customers be - serious outdoor activity enthusiasts making pre-planned purchases of specific pieces of clothing or equipment (and who may make additional unplanned purchases at the same time), 'impulse' off the street trade, or a mix of both
  • where will your premises be and will you have more than one outlet
  • will you sell online, either through your own website or through online marketplaces like eBay and Amazon
  • what will your opening hours be
  • what will you do to advertise and promote your business

Your products

You will need to consider the range of equipment, clothing and footwear you will stock, particularly if space is at a premium. Will you:

  • specialise in one particular outdoor activity, such as climbing, or will you stock equipment for a range of different pursuits
  • stock a high percentage of fashion clothing and footwear at the expense of technical equipment to try to broaden the appeal of your outlet
  • sell second-hand equipment - for example, you might allow customers to part exchange their old equipment against new purchases and then resell the part-exchanged equipment either in your shop or on eBay
  • sell a range of accessories, such as watches, sunglasses and so on
  • try to monitor which are popular and unpopular lines - and if so, how will you achieve this

Your services

You may offer certain services, such as:

  • equipment hire. You may decide that there would be a market in your area for hire of outdoor equipment, for example snow sports equipment and clothing, which customers would take on holiday with them rather than having to hire it in the resort
  • equipment servicing and repair. For example skis and snowboards need reasonably frequent servicing and repair to keep them in good order. There may also be an opportunity in your area to offer repairs to other equipment, such as bikes and watersports equipment


  • what will your pricing policy be (don't forget, you must be able to cover your costs, overheads and drawings)
  • how often will you review your prices
  • what will your policy on exchanging goods be
  • will you offer credit for purchases over a certain value
  • will you offer discounts, special offers and so on

To help with your decisions, click on the checkpoints for guidance. Once you have worked out a Cash sales figure add it to the relevant field in your cash flow forecast.