13-Week Liquidity Plan: How Swiss SMEs Develop It

Of every 100 companies founded in Switzerland, about half are still in business after five years. This is shown by the business demography data from the Federal Statistical Office. The statistics do not cite any reasons. Anyone familiar with the inner workings of a company knows that, in the end, it is rarely the product that fails—it is the bottom line.

A company doesn’t go under because of a bad year. It goes under when a payment is due and there isn’t enough money. You can see this coming—weeks in advance. The tool for this is called the 13-week liquidity plan. It’s nothing fancy, doesn’t require any new software, and can be set up in an afternoon.

Most small and medium-sized businesses plan their cash flow—if at all—on a monthly basis. Monthly revenue, monthly expenses, balance. If the number at the end is positive, the month is considered secure.

The problem lies in the month itself. Wages are paid around the 25th, while customer payments come in sporadically or in a rush toward the end of the month. In between, the account can slip deep into the red, even though the month ends in the black. The monthly plan shows the beginning and end of a period, but not the dip in the middle.

Here’s an example using rounded figures: A Swiss SME with about 40 employees is projecting a surplus of CHF 60,000 for December. The weekly forecast shows a low of minus CHF 180,000 for the week before Christmas. December salaries and the 13th-month bonus are paid on the 20th, while large customer payments don’t come in until the last few days of the year. The credit limit is just barely insufficient. If you notice this in October, you have time to find a solution. If you notice it on December 18, you no longer do.

Some of the outflows are non-negotiable and fixed by calendar date. These specific dates are the first to be included in the 13-week liquidity plan:

Value-added tax deserves special attention. It is customers’ money that is only temporarily held in the company’s account, and it is due in a single lump sum. The deadline for the third quarter is at the end of November, and for the fourth quarter, at the end of February. Both deadlines fall in months when a lot of cash is already flowing out of the company anyway.

The plan is a table with 13 columns, one for each week. Thirteen weeks make up a quarter: long enough to see the next VAT filing and the next month-end, but short enough to make reliable estimates.

The lines follow the money, not the accounting:

• Opening balance from online banking, not from accounting, which is always a few days behind.
• Payments received from outstanding invoices, based on the customer's actual payment history.
• Fixed payments according to the payment schedule: wages, social security contributions, value-added tax, rent.
• Other Payments: Suppliers by due date, as well as investments, loans, and distributions.
• Weekly closing balance, with the credit limit shown below it. The difference is the available credit.

What’s important is what’s missing: depreciation, provisions, and accruals. They affect profit but not the account balance. The article “Profit Is Not Liquidity” explains why the two can diverge so widely.

When I join a company, the first thing I ask isn't about the budget, but about the lowest account balance over the next three months. I almost never get an answer right away. With these four steps, I'll have the answer by the end of the afternoon:

A 13-week liquidity plan is already one week old. That’s why it’s updated every week on the same day: the previous week is removed, and a new one is added at the end. This takes half an hour if the data from the bank and accounting is ready.

The second half of the half-hour is the more important part: comparing last week’s forecast with what actually happened. If you do this for a few weeks, you’ll learn which customers tend to misjudge demand and which line items are always too optimistic. This doesn’t make the plan perfect, but it does make it honest.

For the board of directors, one page per month is sufficient: the lowest point over the next 13 weeks, the margin to the lower limit, and the measures adopted. The Swiss Code of Obligations has been explicit on this point since 2023: “The board of directors shall monitor the company’s solvency” (Art. 725 CO). This page is the simplest way to comply with this requirement.

If the lowest point falls below the lower limit, there’s only one course of action: first, take matters into your own hands—that is, issue invoices earlier, tighten up your collection process, and postpone orders—then talk to the bank. With a plan in hand, the conversation will be very different than if you went in without one. If you don’t want to manage the plan yourself, you can outsource it. As part of our “CFO as a Service” offering, it’s included as a standard feature.

What is a 13-week liquidity plan?

A weekly preview of incoming and outgoing payments for the next thirteen weeks. It shows the expected account balance for each week, allowing you to see when funds will run low long before it becomes apparent in your account.

Is Excel enough for this?

Yes. For an SME, a table with thirteen columns is sufficient. What matters isn't the tool itself, but that the plan is updated every week and compared with actual results.

How much of a liquidity reserve does an SME need?

There is no one-size-fits-all figure. A useful starting point is a minimum threshold consisting of one month’s salary plus the next VAT payment. The 13-week plan will then show whether this threshold holds up in the coming weeks.