The festive season is almost upon us and most of the country is already looking forward to relaxing with family and friends. But while no-one is more deserving of a few days off than Australia’s business owners, Christmas can actually be an extra stressful time for them.
It’s not just the difficulty of switching off when you’re the boss. The prolonged break between Christmas and New Year can bring genuine logistical and cash flow problems for businesses.
With some people taking a few days off and others making it a long week’s holiday, deliveries will be disrupted, invoices won’t be paid, and it’s easy to fall behind on orders. Before you know it, your business is in the red and it can be a long uphill struggle to get back into a cash positive position in January. Meanwhile, your overdraft or business loans will be racking up interest…
However, with a little forward planning, it is possible to set up your business so that it goes into Christmas in a strong financial position, and has the ready cash too hit the New Year running.
Get your invoices out early
As many people won’t be in the office after the 22nd, you need to get this month’s invoices out early. There’s nothing wrong with that. Simply attach an explanatory note alongside some suitable seasonal greetings.
Don’t be a Scrooge
You should also follow up any outstanding invoices from previous months well before the Christmas break. Don’t wait to the last minute: in the rush to wrap things up before the holiday, paying invoices will be low on the list of priorities; and you’ll look like a real Scrooge chasing debts on Christmas Eve…
With all the disruption that’s coming, it’s best to plan for a cash emergency. You want money in the bank to cover any additional costs that might come up over Christmas and well into the New Year, because it can be a long wait for the next set of invoices to go out in January. Flexible invoice financing can be a great way to get your business in a healthy position by getting money up front on selected debts. Talk to tim. early to set up your account – after that, you’re in control.
Plan your purchasing
Your business also needs clarity on the supply side, especially if you plan on working a few days between the Christmas and New Year holidays. Communicate your needs to your suppliers in advance and make sure you know their revised schedules for the season. You want to be stocked up and ready to go in January, while everyone is feeling positive and keen to make good on their resolutions!
Negotiate terms in advance
Your suppliers will be in the same position as you with regards to cash flow over Christmas so this is an excellent time to negotiate terms in advance. You can help them out by offering early payments and should be able to get a better price if you’re prepared to offer cash up front or on delivery.
If you haven’t got the money in your business bank account to do that, it’s time you looked at tim’s revolutionary Accelerator Funding solution for supplier payments in advance. It’s the perfect tool for lubricating your supply chain and uses the discounts obtained for prompt payment to cover the cost of the invoice finance. And because you’ll be helping your suppliers with their cash flow issues over the festive season, you’ll look like Santa and not Scrooge.
Then you can put your feet up and enjoy Christmas!