Christmas.
If you are a retailer or hospitality and events business, the chances are this is one of your key trading periods and you are rushed off your feet (you probably don’t even have time to read this blog).
However, for many other types of business, the festive period can be a major low point and cash flow can be a real concern when things go quiet.
We have pulled together 5 key tips to help these businesses ride out the festive period.
1. Use the ‘downtime’ to get organised
Use this quiet period to start the jobs you didn’t get round to completing during the year when trading was busy. A few ideas to get you started:
• Sort your paperwork out, throw away what you don’t need and file what you do. A clear desk is refreshing to come back to after the Christmas break
• Conduct staff reviews. Often these can be rushed or overlooked during the busy periods, so focus on your staff and take time to sit down with them and review their work
• Plan your business strategy for the new year
• Send out customer surveys for feedback and reviews
• Update your website
2. Plan your finances
If you know that the festive period is a quiet time for your business, making financial plans to ensure you ride it out with minimum disruption is an absolute must.
Ensure you control your incomings and outgoings, plan in advance to have enough capital to cover unexpected expenses with the minimum of fuss.
There is no reason to panic at the same time each year with the same financial difficulties. Forward financial planning is essential.
3. Factor in ‘late payments’
If this is a quiet time of the year for you, chances are it will be the same for your customers who may try and hold off paying you until the last minute, or even late.
Consider how you can combat this; could you offer an incentive for early payment? Factor this potential ‘cash shortage’ into your financial planning (Tip 2) so it doesn’t have a disastrous effect on the stable running of your business.
4. Negotiate your rent payments
Many businesses who pay their rent quarterly find the December/January payment a real stinger.
Why not ask if you can pay your rent monthly? Or pay your rent in advance when cash is abundant (maybe they would offer you a discount for early payment)? Again, planning is key!
5. Stop spending!
During the quiet period, consider what is essential and what is not.
When cash is abundant, it is easy to be generous with business lunches, overnight stays, upgrading technology etc but come the quiet period, you need to get a handle on your finances.
If you want to pay staff Christmas bonuses, ensure you have factored it in during the year to enable you to do this.
Avoid spending on anything other than ‘essential’ travel arrangements, and don’t settle up the bar bill at the staff Christmas party! It’s nice to be generous but not to the detriment of your business.
Next steps
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