Christmas is coming around the corner and for the likes of retail stores it is an extremely busy period for sales and income being generated.
The same can’t be said for other businesses. Christmas means closing-up shop for many businesses who won’t make income for approximately two weeks out of the year. It can be a difficult time, perhaps the most difficult out of the entire year.
Factors such as all employees’ wages, holiday pay, Christmas bonuses, fixed payments and Christmas parties have to be considered with the Christmas-shutdown. Here are a few ways businesses can manage their cashflow more effectively over this challenging time.
Chase Up Invoices
Coming up to the holiday season clients who still owe you money for services is a common occurrence and it can be a challenge to squeeze this out of them.
Chase up any unpaid invoices before the year is up to help with your cashflow management. You don’t want to be going into January with unpaid invoices from the previous year still hanging over your head.
Offer Discounts For Quick Payments
If clients are particularly difficult to get a hold of for your invoices offer a 5-10% discount on quicker payments to ensure you get that income flowing in and to speed the process along.
Plan Ahead Of Time
As Christmas occurs at the same period every year there’s no reason why you can’t plan ahead of time by saving as you go along before the inevitable.
Put some money aside bit by bit each month for all the added expenses which will follow.
Make A Budget
The period leading up to the holiday season is going to bring fourth extra expenses that aren’t part of any other month such as staff presents and Christmas parties. Plan for these unexpected expenses by setting aside a budget so you don’t get caught off guard and fall into debt.
Don’t forget about the time you take off either. You are sure to be spending money with and on your family and friends. Be prepared for all the costs the holiday season brings and consider your budget and just how much you are able to afford and set aside.
Prioritise Expenses
A reduced budget for normal requirements will occur during the Christmas period. Prioritise your expenses this holiday season. What can you put off until next year? Delay expenses for repairs and maintenance until your cash flow improves or any other major expenses.
Consider A Short-Term Loan
Perhaps your business is exhausted of income and in order to prevent serious problems you could consider taking out a short-term loan from the bank to help with Christmas expenses.
Organising payment plans with your creditor, consulting with your accountant or approaching a specialist finance company are all options you could opt for.
Focus On Expenses That Generate Income
Cut costs over the Christmas period by only focusing on expenses that generate results. This isn’t a time to include expenses that don’t generate income, no money coming in then don’t spend it.