Are you dreading Christmas? As a business owner, you’re likely dreading more than the present shopping and food prep for the big day. For a small business, cashflow is king, and the December/January period is often challenging financially.
It’s no secret that smaller businesses are often in a more ‘hand to mouth’ scenario money wise, making the impending festive season more than a little bit stressful. Two of the biggest stressors, especially for service based businesses at Christmas are:
- Slow payment of invoices across December and January – this can put big strain on the ability of a business to meet overheads
- A significant drop in revenue generating work across December/January – with many businesses taking leave, work coming in can slow down a lot, creating a large decrease in billing ability
With only a little under three months to go until the Big Fella makes his way down the chimney, what are some of the steps you can take to prepare your business for the quiet season?
Reminisce about Christmases Past
Whilst Aunty Glenda’s trifle may be on your mind here, think finances instead. Take a look at your figures for last Christmas. Was there enough in the pot to cover all of the overheads comfortably? What was the uptake of your products and services like at that time? Make some informed decisions about how you proceed into this Christmas by using those figures. It may be a good time to increase sales of products through some strong promotional activity in the lead up to and through November. If you’re service based, now is a good time to check on your customers and see what extra help they may need. You never know, they may be waiting for a call!
Talk to Ebenezer
Okay, so this really refers to your bank, and whilst they are strict with their money it is also worth speaking with your bank in the lead up to Christmas, to see what additional support and safety nets can be put in place for you. If through analysing your finances, you found you were more reliant on an overdraft during that period, now is the time to start talking to your bank about how you can ensure you have a big enough safety net to help you get through. Just remember to factor in how easily this overdraft can be serviced on the other side of Christmas.
Promote, Promote, Promote
There is never a bad time to promote your business, and in the lead up to the quiet season, now is probably the best time of all. What are your unique selling points? Are people really aware of them? Focus on what makes your product(s) or service(s) better or unique, and really drive that message. Your business is your baby, so don’t be ashamed to let people know how proud you are and encourage them to check you out.
Remind them of what you Really want for Christmas
If all you’ve received for Christmas in the past is the sound of crickets from the people who owe you money, get proactive. November is a great time to send out reminders to your customers about what they owe you. This gives you time to follow up any late payments in the early stages of December. Make sure you send your invoices for December and January out promptly and before Christmas. By doing this, you set yourself up to be paid more promptly, and your debtors have no excuse for not having paid, or arranged a payment arrangement with you.
Communicate with Suppliers
Worried that you might not quite have enough to make it through? Whatever you do, make sure you talk to your suppliers. They’re likely feeling the same stresses, but if you get in touch with them to make payment arrangements, they can then manage their cashflow better too. The added bonus is that by communicating with your suppliers, you’ll create a more trusting relationship with them and they’ll be more likely to want to help you in the future.
Whether you love Christmas or hate it, by taking some simple proactive steps between now and December, you can lift some of the stress that this time of year inevitably brings with it.
Of course, if you’re unsure how you’ll get through, or you need a little bit of help looking at your finances and making some plans, Biz Assist is always here to help. Get in touch by clicking here, to have a chat, and we can ensure that you’re celebrating this Christmas, rather than worrying about the finances.