Cash Flow Tips

Cash Flow Tips With only 135 days until Christmas some of you may be planning office Christmas parties, while others may be concerned about their impending Christmas Cashflow. We have therefore put together some cashflow tips to help your business avoid the Christmas Cashflow Chasm over the December to February months when we all look ​to take a well-earned break.

What may cause a cash flow crunch over the festive period?
During December and January many businesses experience a slow period directly impacting on their cashflow. Many businesses see their sales and customers dramatically slow over the holiday period, some carry out planned shutdowns and for those who remain open, they operate on skeleton staff!

​Therefore, putting plans in place now before the rush hits, ensures you are ready to start the new year on a high!

What to do to avoid a cash flow crunch.
Forecast your cashflow

1. Identify all possible payments and expenses (eg. inventory, utilities, sales and marketing, other potential expenses)
2. Identify when you expect to pay for those expenses and how much
3. Forecast your Christmas sales based on previous years

Reduce expenses
Try reducing any expenses that are non-essential (if possible) or postpone to a later date. If there are expenses that cannot be delayed, set aside some cash on a regular basis throughout the year.

Keep up the invoicing
Be consistent with your invoicing to minimise the risk of customers not paying before the Christmas closure period.

Maintain supplier relations
Open communication with suppliers throughout the year puts you in a position to negotiate more favourable payment terms if need be.

Look back and improve
Once the festivities are over, take a look back to see what worked for your business. It’s always important to look back and continue making improvements.
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There is no time like the present. So start your Christmas cash flow planning now to stay ahead.