Managing cash flow is always a little tricky for many businesses. It can be incredibly challenging during the Christmas and New Year periods as many businesses choose to shut down during this time. Therefore, it is essential to set aside some quality time to plan your business finances and cash flow to ensure your business runs smoothly through the festive season. Let’s check out our top tips below on how to best manage cash flow for your business.
Forecast cash flow and plan for any irregular expenses
The festive season is a time to strengthen relationships with your team and customers. From staff gatherings, client entertainment to Christmas gifts, these once-off expenses must be planned and forecasted for to ensure you have sufficient cash flow.
Moreover, certain expenses may attract higher prices during this period. This could be for the cost of logistics, temporary staff, or even office supplies. Hence, it is best to set aside some cash to avoid any unnecessary stress.
Stock up on cash
For any B2B business, it would be prudent to preserve cash on hand as much as possible. This is because there will be some customers who will be unable to pay you on time during the holiday season. You may start to find that your business is unable to meet expenses when they fall due. You may wish to consider:
Active control of invoicing
If your current invoices are not paid by the first week of December, it’s unlikely you’ll see the money until mid or late January in the new year. Here are a couple of things you can consider to increase your chances of getting paid early or on time:
Backup finance facility
Despite all the due diligence and planning done, sometimes life just does not go as planned. Therefore, it might be worthwhile to have a reliable finance facility in place so that your business can tap into funding when required. This is especially helpful during the festive period and months were cash inflows are lower.
At InvoiceInterhange, we offer invoice finance to help you get paid sooner and rid gaps in cash flow by advancing the funds owed to you in outstanding invoices. Rather than feeling stressed and anxious about when you will get paid by your customer, you decide which invoices to fund, with no need to commit your whole sales ledger. When you get paid sooner you can easily cover upfront costs or overheads, quickly pay unexpected bills or salaries and flexibly access working capital for growth.
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