Has the stress of the holidays sunk in yet? Do you still have holiday tasks to tackle before the guy in the big red suit shimmies down the chimney this year (like figuring out what the heck Orbeez are, and if they’re age-appropriate for your 5-year-old niece)?

As for your business, you’re likely looking at an influx in appointments, or an increase in customers wanting holiday discounts and gift packages. But the biggest thing on most business owners’ minds is money. Am I managing it well? Am I getting paid on time? Do I have the cash to handle the upcoming holiday rush?

Top Financial Stressors

Yup, it all comes back to money. But money doesn’t have to be an added stressor this holiday season. Let’s look at the top ways it could dampen your spirits.

Late Payments

Even the biggest chains and franchises share the struggle of facing late payments from customers, especially during the holidays and before you run your year-end numbers. In fact…

More than 70 percent of the business owners surveyed say they faced at least one serious business problem during last year’s holiday season, the most common being late payments.


  • Money’s tight for most people during the holidays. So this time of year is more likely to cause delinquencies.
  • You have so many customers, especially during this time, it’s easy to miss when someone hasn’t yet paid you.
  • Your own processes are making it tough to pay you. You’re simply too busy running your business to focus on invoicing and payment processing.

Being Cash Poor

How you get paid and problems with cash are closely related. When you’re low on cash, it can feel like a constant, frustrating cycle. In some instances it’s a “Which came first?” situation, where you’re not sure if your lack of cash made it tougher to pay you on time, or if late payments from customers caused you to be cash poor.

Either way, cash flow issues can lead to a pretty devastating downward spiral. Why? So many aspects of running a healthy, growing business involve needing cash for reinvesting. For example, the first thing often cut when small businesses are tight on funds is marketing. And when you cut your marketing, you diminish your ability to attract new customers. Fewer new customers means less cash flowing in, and down the spiral you go.

Ghosting Customers

Halloween’s over, but that doesn’t mean the ghosts are gone for good. Every small business has dealt with a customer who’s left pleased with the services rendered, then fell off the map when it came time to pay. We’ll call these folks ghosting customers, since they seem to vanish into thin air after you’ve held up your end of the bargain.

Payment Processing Fees

If and when you do get paid, it’s painful to watch your profits get chipped away by the fees associated with payment processing solutions. Though most solutions come with some sort of fee(s), many are greater than others. Even worse – some of the sneakier solutions providers hide these fees until it’s too late for you to notice.

5 Ways to Address Holiday Financial Stressors

Managing your money will always be a crucial part of running your business. But banging your head on your desk trying to straighten it all out doesn’t have to be.

1. Check customer credit before doing business with them.

Credit checks can sound and feel a little invasive if you don’t typically run them for new customers. But if getting paid or getting paid on time seems to be a recurring issue, it may be time to explore implementing credit inquiries for your biggest-ticket jobs.

What types of businesses run credit checks?

  • General contractors bidding large-scale home improvement projects
  • Pool and outdoor living space designers and builders
  • Fencing companies
  • Landlords looking to approve a new tenant
  • Pet groomers taking on a new Corgi client (just kidding on this one)

The key here is to be upfront with customers regarding your credit expectations. Explain in a non-threatening way that you conduct credit checks for all big-ticket jobs, and that this is a common practice for local businesses.

Then, decide the standard you’re willing to work with once you get a report, and stick with it. Pro tip: Don’t act too rashly and immediately turn down customers with less-than-squaky-clean credit scores. Instead, communicate to customers who don’t meet your standard that you’d be able to complete the job with payment in full prior to service.

The most popular, and often least expensive, method for running credit checks is to do it yourself.

Popular credit check tools:

Word to the wise: Running credit checks can bring you into the world of discrimination via the Fair Credit Reporting Act (FCRA). Learn as much as you can about this, and ensure you’re not discriminating unfairly if you do make a financial decision based on someone’s credit.

2. Be smarter about invoicing.

Nearly 6 in 10 business owners say they have to follow up at least twice to get certain customers to pay them. If you ask us, that’s 2 too many times.

The best way to improve your invoicing is to address it on initial invoices.

Invoicing best practices:

  • Send them promptly. Make sure you’re sending invoices as soon as a service is complete or a product has been delivered (same day whenever possible). Any delay on your part could be interpreted as flexibility in your payment timeline.
  • Confirm receipt. When a job is done to your customer’s satisfaction, make sure you have their correct addresses, both physical mailing address and email address.
  • Incorporate branding elements like your logo. This may not seem important until you think about the sheer volume of emails people receive on a daily basis. If yours isn’t branded to stand out from the crowd, it could easily get lost in the shuffle.
  • Be as detailed as possible. Another reason invoices don’t get paid is that customers may have questions with what you’re charging. Hopefully you set clear expectations from the start. Reiterate these by including as many line items as possible to break down the charges. This way, if anything is in question or seems out of sorts, customers can chat with you about a particular line item instead of disputing a larger amount.
  • Use simple and clear language. Much like being as detailed as possible, avoid industry jargon and abbreviations. It’s much easier to justify spending the money when everyone’s on the same page.
  • Include a payment deadline. These deadlines are typically 1-2 weeks out from the date of the invoice, or a month for more involved projects. This timeline could lengthen even further if you’ve previously discussed a payment plan.
  • Follow up in person. Since tone and temper can often be misunderstood in writing, give any late customers a quick phone call. Remember, you catch more flies with honey than with vinegar, so staying calm and polite is your best bet in getting paid.

3. Offer online billing and payments.

Too many local business owners restrict themselves to cash, check and manual debit and credit card processing. Why? Security concerns, for some. But more often than not, it’s a fear of moving forward with online payment processing solutions based on the fact that they’re just new and unfamiliar.

So if you’re not making it easy for customers to pay you on their timeline, via their device, it’ll become clearer why some may be paying you late.

What to look for in a payment processing solution:

  • Easy transfer to your bank account without delayed wait periods or manual intervention
  • Reasonable processing fees, or any hidden fees outside of a “per transaction” rate
  • An interface that’s simple to use for both you and your customers
  • Options, when it comes to processing credit and debit cards (manual entry, swiping, mobile device photos, etc.)

4. Offer payment installments.

If you’ve financed a wedding at any time in your life, or if you work in the wedding industry, this concept should be very familiar to you. Most vendors understand that weddings are an expensive undertaking, and they offer payment installments to take on some of that burden.

How it typically works:

Even if you don’t work in the wedding industry, here’s the typical installment methodology.

  • Start by asking for a down payment. Make this a percentage of the total estimate, typically a round number like 10%, 25% or even 50%.
  • Break down the subsequent installments. These would typically be in increments of 2-4 additional payments, to be paid out just prior to or upon completion of your work.
  • Send regular reminders when a payment deadline is approaching, so customers remember to make their next payment.
  • Communicate clearly the ramifications for falling behind on payments, especially if you plan to halt your services.

5. Consider cutting ties.

For customers that consistently pay late or fail to pay altogether, it’s worth considering whether or not you want to continue doing business with them. And, by halting your services until you receive full or partial payment, you’ll be more likely to ensure a client will actually pay.

You’re not in business to work for free, after all.