For many SMEs, the festive season may be one of the few opportunities that your business has to shut down and take a break. But it also marks the beginning of a quiet time for many industries. January can be a particularly slow time for sales, so we’ve put together some simple tips so you can manage your cash flow more effectively.
From prompt invoicing to cash flow forecasting, we want you to retain a healthy cash flow over the silly season.
AIM FOR PROMPT PAYMENTS
The most basic way to improve cashflow is to ensure any completed work has been paid for. Before your staff go on their holiday break, make sure all jobs are invoiced and any outstanding debts are chased up. Many clients will be busy with their own jobs or planning their own holidays, so touching base to remind them to pay their invoices is a must in December. The earlier you speak with your clients about any outstanding invoices, the better!
DON’T FORGET THE DEBTS
If your business also owes money, make sure you organise a payment schedule as soon as possible. Most businesses understand that the festive season is an unusual time of year in terms of budgeting, so working out your expenses in advance can help you with better managing your business cashflow.
BE SMART WITH SILLY SEASON SPENDING
Christmas is a great time to show your staff that you appreciate their hard work, but make sure you crunch the numbers before you go organising those Xmas parties and gifts. Check out our previous blog for further details on fringe benefits tax and Christmas parties and spend smart over the festive season.
CASH FLOW FORECASTING IS KING
Maybe it’s not your favourite task, but cash flow forecasting is crucial for businesses of all sizes. And the fact is that businesses largely fail because they simply run out of money.
To increase your chance of success and prepare for business growth it’s vital to understand your exact financial position. Our team specialise in cash flow forecasting and can help you create a financial plan for the future.
Would you like to learn how to better manage your cash flow? Why not connect with our team at Meridian Accounting by calling our Rockhampton office on (07) 4927 4625 or our Emu Park office on (07) 4938 8262.
* The views and opinions expressed in this blog are those of the authors and do not necessarily reflect the official policy or position of any other agency, organisation, employer or company.