How much cash do late wholesale payments need?

Build a dated cash baseline

Start with reconciled, usable bank cash. List customer receipts, supplier deposits and balances, freight, import charges, wages, overheads and finance repayments by expected cash date. Include overlapping China orders, not just the shipment whose customers are late. Use our China order cash-flow calendar to assemble the payment schedule.

Choose a minimum cash reserve for essential operations. Record confirmed borrowing separately, including when it can be drawn and when it must be repaid. Exclude restricted cash and unapproved facilities. Save the baseline before changing receipt dates so you can distinguish an existing funding gap from the extra pressure caused by late payment.

Move receipts without counting them twice

For each wholesale invoice, record the outstanding amount, original forecast receipt date, revised date, reason for delay and evidence supporting the new date. Ask the customer's accounts team whether the invoice is approved, disputed or awaiting a payment run. Use payment history to challenge an unsupported promise.

Remove the receipt from its original forecast period and place it in the revised period. Split partial payments into separate receipts and leave the unpaid balance outstanding. Keep a realistic case and a more delayed case, including several customers slipping together. If collection timing is unknown, exclude that receipt from the test until beyond the supplier commitments being assessed.

Calculate the peak funding gap

Carry each period's closing cash into the next period, add expected receipts and subtract payments. Use shorter periods around tight payment dates so a healthy period-end balance does not conceal a shortfall earlier. Extend the rolling forecast through delayed collections, the next supplier commitments and any bridging-finance repayment.

At each date, compare projected cash plus confirmed undrawn finance available then with your minimum reserve. The largest amount below that reserve is the funding gap for that scenario. Compare it with the baseline funding gap to isolate the extra funding caused by the delay. Do not add shortfalls across periods: the same cash gap can persist until collection.

Record the first reserve breach, deepest shortfall, affected supplier payment and expected recovery date. If the baseline already needs funding, report that separately from the additional requirement. Our working-capital guide helps with the wider order budget; this test focuses on when cash becomes unavailable.

Test the next supplier payment before committing

For each supplier deposit or balance, check cash immediately before and after payment in each scenario. Keep its agreed date unchanged unless a revised schedule has been accepted. A customer's later payment promise does not itself change your factory payment plan. Check the release conditions using our supplier balance-payment guide.

Where payment would breach your reserve, identify a concrete remedy before approving another order: collect an agreed customer part-payment, arrange confirmed finance, postpone an uncommitted purchase or seek a revised supplier schedule. Add associated charges and repayments to the forecast. Rerun it to confirm the remedy covers the gap without creating another shortfall.

Keep the forecast rolling

Replace forecast entries with actual bank movements as they occur, update outstanding invoices and add future commitments. Retain the previous version and explain changed assumptions. Give each threatened supplier payment an owner, an action and a decision date before funds must be sent.

Send Cambridge China Bridge the order references, payment milestones and dates at risk. Its staff in China can check the factory's current production position and ask whether payment or dispatch changes are workable. Add only confirmed changes to the funding case, then reassess customer receipts and available cash before authorising payment.