Holiday Cashflow for Your Small Business

Posted 8 Dec '23

Holiday Cashflow for Your Small Business

Whether you’re heading into a holiday period, or just planning to take a break (and congratulations, because a healthy business means work-life balance), it’s important to keep your cashflow under control.

This time of year can be hard on small business. There are still overheads and salaries that need to be sorted, your expenses continue and your cashflow can suffer when your debtors go on holiday. With a bit of pre-planning and being proactive, you can set yourself up for a financially stress-free holiday. Make sure you have a clear picture of your payroll, and any other planned expenses that will need to be accounted for.

If there’s even a possibility that there could be a shortfall, it’s essential to meet this head-on. Whether this means talking to your supplier or creditors to figure out an arrangement, or compromising on other business outgoings, you must make a plan to ensure that the business, or your staff, won’t suffer.

Tips to minimise the stress and planning of cash-flow over the holiday period

Invoice early - Send any invoices that you can, and in advance if possible. Perhaps consider whether you have any regular clients or customers that you could offer a retainer or similar deal to if they book services or make a purchase from you in advance.

Chase payment - Use this opportunity to chase up any outstanding payments. Strong communication and relationships matter - talk to clients and chase invoices.

Talk to suppliers - A little honesty can go a long way. Perhaps they can extend a line of credit for your payments to them. In most cases, a good supplier would rather offer a little flexibility to keep an ongoing business relationship.

Review your costs - It’s also a good idea to do a general review of expenses. Business costs can creep up, and it’s a great idea to make a time to check on your expenses regularly, no matter what your financial situation. Review all of your regular payments and subscriptions as well as upcoming costs. There may be travel, functions or purchases which you can decide on an alternative approach to.

Talk to the bank or tax office - If cashflow is tight, make sure you have conversations early so you have everything in place to see you through.

If you have further questions and would like help navigating cashflow considerations for a holiday period, get in touch with your WDF team member on 6921 5444.

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