The holiday season is a booming time for retailers and most service-based industries. There’s plenty at stake, so businesses must take advantage of these sales opportunities. Well, what does that look like?
It could be overstocking the shelves with customer favorites, upping marketing efforts or increasing your staff. These things take money, so don’t let cash be the reason you struggle this holiday season. Manage your cash flow and expect a successful holiday season.
Anticipate Your Cash Flow
A detailed expectation of spend and revenue will help in identifying any pain points that could cause drama in the finance department. If your business is going to be impacted by declined sales, increased staff costs or late payments from customers, your plan should reflect that.
Use that information to create your plan and dodge as many financial drawbacks as possible. Analyze your company’s cash flow by taking note of these items.
- Review current cash flow statements. Are there any outstanding accounts that can be collected to add more to your pot? Consider looking at statements from last year for ideas on how to better manage this season.
- Review your credit policy. Have you thought about cutting your invoice due-date down? Consider offering an incentive to accounts paid within 15 days as opposed to the usual 30 days.
- Consider your own accounts. Don’t rush to pay early and make yourself tight on cash unless your vendors offer worthy terms.
- Examine current and planned inventory purchases. You don’t want to tie up your money in items that won’t sell.
Tackle Invoices Head-On
These are the busiest months for retail and hospitality, but other industries can see a drop. Sales slow and customers take longer to pay. Money can get tight for you and your customers; we get it. That’s why it’s time to start collecting those I-owe-yous now.
Invoices left unpaid can kill your positive cash flow, even beyond the holiday season. It’s time to nip that in the bud. Skip the game of phone tag and use Thrvy to get invoices paid. The interactive invoice makes it easy for your customers to pay from their phones and you’re able to track overdue payments with an automated follow-up and keep the cash flowing.
Let’s take a moment to be honest. Things happen and sometimes your customers need a bit of payment grace. Your customers are the heart of your business so meet them where they are. Automated installment plans are a breeze with ThryvPay.
Switch It Up
Many small business owners took advantage of the unique opportunity COVID presented to reimagine their businesses. If you haven’t yet, consider diversifying your streams of income. If you’re a family-owned restaurant with a brewery, consider tapping into the world of online cooking classes. Get your team together for a bit of brainstorming. No idea is too crazy. Perhaps this holiday season is when you step out and launch a line of merchandise.
Expect the Unexpected
If you’re like many businesses, you drop dough during the holiday season to show your staff you care. Whether you’re showering them with gifts, rocking parties or the like, make sure your cash flow is prepared for the seasonal lull.
Assume your company will take a small hit. Postpone any big spending that isn’t crucial to your business. We promise it can wait until revenue is on the upward tick. This way, you can safely finance anything that may pop up or simply avoid going into the red.
Ready a Loan
You never know how quickly a situation can turn sour so, plan for the worst. If you don’t have a bit of money on the side at your disposal, whether that’s due to poor planning or simply a troublesome period, consider looking into business loans to temporarily help the load.
No one loves the idea of going into debt; however, small business loans and lines of credit help further growth and success. Issues manifest from lack of preparation. Avoid predatory loans and financial pitfalls by creating a game plan:
- Identify your business’s financial needs
- Research loan and line-of-credit options
- Organize your paperwork according to the eligibility criteria and application requirements
- Prepare to discuss with your lender how you’ll use the funds, and think beyond the holiday season