Cash runway: how many weeks could your business last?

Startups talk about runway all the time: how many months until the money runs out. Established small businesses rarely do. But the question is just as useful for a café, a plumbing business or an online store: if sales slowed sharply tomorrow, how many weeks could you keep paying the essentials?

Knowing that number changes how you make decisions. It tells you how much risk you can take, how big a customer you can afford to wait on, and whether you need a safety net in place before something goes wrong.

The runway formula

It’s simple:

Cash runway (weeks) = available cash ÷ weekly essential costs

The trick is in the two inputs.

Step 1: Work out your available cash

Start with the balance across your business accounts. Then subtract money that isn’t really yours to spend:

Item	Why it’s excluded
GST collected but not yet paid	Belongs to the ATO; due with your BAS
PAYG withheld from wages	Belongs to the ATO
Super owed to employees	Under Payday Super (from 1 July 2026) it must reach their funds within 7 business days of payday
Customer deposits for work not yet done	You’ll need it to do the work
Money set aside for annual bills	Already committed

What’s left is your available cash. For many businesses, it’s noticeably smaller than the bank balance.

Step 2: Work out your weekly essential costs

Essential means the costs you’d still have to pay to keep the business alive through a slow period:

• wages for the core team, plus super
• rent and outgoings
• loan, lease and equipment repayments
• insurance
• key suppliers you can’t trade without
• utilities, phones and essential software

Leave out discretionary spending you’d pause in a downturn, such as marketing, non-urgent upgrades and owner drawings above a basic amount. Convert everything to a weekly figure (monthly × 12 ÷ 52).

business.gov.au recommends creating a budget and putting money aside for ongoing costs, including tax, wages and super. Your budget is the best source for these figures.

Step 3: Divide

Illustrative example. A Melbourne physio clinic has $68k across its accounts. It’s holding $14k of GST and PAYG and $3k of super due after Thursday’s payday. Available cash is $51k. Essential costs (wages and super for the core team, rent, equipment loan, insurance and software) come to $17k a week.

Runway = $51k ÷ $17k = 3 weeks.

That’s the number. If income stopped completely, the clinic could keep paying essentials for about three weeks from its own cash.

What’s a healthy runway?

There’s no official benchmark, and anyone who quotes one confidently for every business is guessing. What matters is how your runway compares with the risks you face.

Your situation	Runway pressure
Steady daily takings (cafés, retail, clinics)	Lower; income rarely stops entirely
A few large customers on long terms	Higher; one late payer can halve income
Seasonal income	Higher; the runway must cover the off-season
Project-based work (construction, events)	Higher; gaps between projects
Fast growth	Higher; growth consumes cash

A useful test: could your runway cover your biggest single risk? If your largest customer is 40% of revenue and pays on 60-day terms, could you survive them paying a month late? If not, your runway is shorter than your risk.

Runway shorter than you’d like? Start a 60-second enquiry and we’ll look at a standby facility that’s ready before you need it.

Three ways to lengthen your runway

1. Increase available cash

• Collect faster: invoice the same day, ask for deposits and follow up on a schedule. See getting invoices paid faster.
• Free up stock: clear slow-moving lines.
• Sell idle assets: equipment you rarely use.

2. Reduce weekly essential costs

• Review every recurring cost and cancel what you don’t need.
• Negotiate better supplier terms, which reduces cash going out each week. See negotiating supplier terms.
• Refinance short-term debts onto terms that suit the asset’s life.

3. Add standby funding

You don’t have to hold all of your runway as idle cash. A business cash line that sits unused until needed extends your safety margin. Count it separately:

• Own-cash runway: how long you last without borrowing.
• Total runway: own cash plus standby funding.

For the illustrative clinic above, a $50k cash line would add roughly three more weeks of essential costs, doubling its total runway without tying up cash.

When should you check your runway?

• Monthly, as part of your normal finance routine.
• Before taking on a big customer with long payment terms.
• Before a big purchase, such as equipment or a fit-out.
• Before the quiet season, if your business is seasonal. See quiet season cash.
• Whenever something changes, such as losing a customer or adding staff.

Runway is a snapshot. Pair it with a weekly cash forecast (our guide to finding your cash gap shows how) to see not just how long you’d last, but when pressure is likely to arrive.

Runway and lenders

Lenders don’t usually ask for your runway by name, but they think about it. A business with a few weeks of cash and a clear plan is a far more comfortable lending proposition than one with three days of cash and a crisis. That’s why setting up standby funding while things are calm is so much easier than applying in an emergency.

If you’re not sure which type of facility would extend your runway best, the four-question which business cash fits me quiz is a good starting point.

Runway by industry: what changes the picture

Different trades face different shocks, and that changes how much runway feels comfortable.

• Hospitality and retail. Daily takings make a total stop unlikely, but weather, roadworks or a quiet month can cut income fast. Rent and wages are the big essentials.
• Trades and construction. Income arrives in lumps tied to jobs and progress claims. Gaps between projects and slow head contractors are the main risks.
• Professional services. Income can be steady, but monthly billing in arrears means a client dispute can delay a large share of revenue.
• Online retail. Payment platforms may hold funds for a few days, and stock commitments can be large and early.
• Health and allied health. Steady demand, but large fixed costs for premises, equipment and staff.

Whatever your trade, ask: what’s the most likely shock, and how many weeks would it take to recover? That’s the runway to aim for.

A runway check for the next 90 days

Put a reminder in your calendar for the first Monday of each month and answer four questions:

1. What’s my available cash today, after setting aside tax and super?
2. What are my weekly essential costs now? Have they changed?
3. What’s my runway in weeks, with and without standby funding?
4. What’s the biggest risk in the next 90 days, and could my runway cover it?

Write the answers down. Over a few months, the trend tells you more than any single number.

Common mistakes

• Counting tax money as available cash. It feels like yours. It isn’t.
• Including every cost as essential. You’d cut marketing and drawings in a downturn; leave them out.
• Ignoring concentration risk. One big customer can make a long runway short overnight.
• Calculating once and forgetting. Runway changes every week.

Lengthen your runway before you need to

The best time to arrange extra breathing room is when you don’t urgently need it. If your runway is shorter than your biggest risk, let’s talk about a standby facility, or about bridging a gap you can already see coming.

Tell us your rough turnover and what you’re trying to protect against. The enquiry takes about a minute, and asking won’t leave a mark on your credit file. We don’t scatter your details among a pile of lenders, and a real person reviews your situation and gives you a call.

Please be accurate about turnover and existing facilities. It helps us suggest something sized for your business, not a generic number.

See if you qualify →