Maintaining Cashflow Over The Festive Period | Zodeq
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Maintaining cashflow over the festive period

date published Published: 13th December 2019

Christmas, New Year and other holidays can all have an impact on businesses and their cashflow. For start-ups and SMEs, the festive period can be a particularly challenging time. Whilst some industries such as retail and hospitality appear to be cashing in on the festivities, others struggle as business slows down.

 

Experienced business owners will try to plan ahead for the Christmas period and have a contingency in place, however in the early years of a new business, it can be difficult to judge and predict the impact the holiday season might have.

 

In addition to loss of business, due to bank holidays and a possible drop in demand, many businesses also have additional expenses at this time of year. Factors such as paying employees early or issuing bonuses can all contribute to cashflow problems.

 

If cashflow is a concern at this time of year there are steps you can take to try and manage your cashflow and a range of solutions that businesses can access to help.

 

Be organised

Make sure invoices are sent out straight away. Many businesses close in between Christmas and New Year so payments are often delayed. Make sure your invoices reach clients in plenty of time so they can be processed before staff take their Christmas breaks.

 

If you are concerned about invoices being paid on time then reminders are a good idea. Speak to clients and make sure your payment isn’t one of the ones put on hold until after the New Year.

 

Consider invoice finance

This can be a great way to ensure cashflow during difficult periods and when late payments could become an issue. It is a flexible solution, there is no long-term loan agreement and no impact on your credit rating. Find out more about how invoice financing, or factoring as it is often referred to, could offer the solution and how the process works here.

 

Speak to your bank

A short-term agreed overdraft may be all that you need to manage cashflow for the tricky couple of weeks over the Christmas holidays. Speak to your bank before it becomes an issue. If you don’t need to use your overdraft facility then that’s brilliant but at least you’ll know it was there just in case!

 

Be realistic

Planning ahead and being prepared for possible cashflow issues can make all the difference. By having a plan in place this should leave you and your staff free to enjoy the Christmas break safe in the knowledge that you have everything under control.

 

If you are concerned about cashflow then get in touch on 01244 617 087 to discuss how we can help.