‘Tis the season for Managing Cash Flow
December is coming faster than a speeding train. Whilst some may be planning office Christmas parties, others may be thinking about their upcoming downturn in cash flow.
For some businesses, Christmas is a mad flurry of activity – namely in the retail and hospitality sectors. Perhaps even more so this year with the easing of restrictions and proposed opening of borders.
But for many businesses, the December and January period is a slow one.
Many see their sales and customers dramatically slow over the holiday period. This in turn has a direct impact on cash flow. It dries up.
So whilst we don’t want to be the Christmas Scrooge, it is worth putting some plans in place now, so come Christmas, your downturn in cash flow doesn’t knock you, and your business, for six.
Here’s a few tips from the team to ensure your business sails through the festive season.
Keeping on top of cash flow management during the Christmas/New Year period
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Keep up the invoicing
It is important to stay on top of your invoicing in the lead up to Christmas. Don’t leave it until the last minute when there is the chance your customers don’t pay you before they close office for the year. Many businesses may also be slow to pay this time of year so don’t let your invoicing fall behind.
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Set clear expectations
Ensure your clients know that the Christmas period is the same as every other period during the year. If invoices are pending just days away from your office closure, give those clients a phone call reminder. If this is an awkward conversation for you to have, engage your bookkeeper or accountant to do the Christmas invoice chasing.
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Incentivise
If you know that the Christmas and New Year period is a slow one, offer some form of incentive to boost your January business. Try deals such as 15% off for the month of January or discounts for referring new business. Everyone loves a little incentive, especially around Christmas time when money is already tight.
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Work on your own business
The quiet period is a great time to work on your own business. Do those tasks that you usually don’t have time for in the busy season. Taking stock of inventory, launching new products or upgrade your systems. Look at all the things on your to-do list and choose a few to conquer before you open your doors in the new year.
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Set funds aside
Christmas can be an expensive time for most of us. With 8 weeks or so to go, now is the ideal time to start planning. Start putting funds aside in a Christmas account. Knowing you have spare funds set aside can do wonders for putting your mind at ease about getting through your quiet period.
There is no time like the present. So start your Christmas cash flow planning now to stay ahead.
