Managing Business Cash Flow During the Christmas Period
Over the Christmas period many businesses experience a slow-down in their work, with some closing down for an entire week, inevitably cash flow will be impacted to some extent.
As a result of this many businesses will return fully to work at the beginning of January in a panic to kick-start their cash flow again for the New Year. The stress of this is entirely unnecessary if a business prepares in advance for this slow period and takes all necessary steps in preparing their cash flow.
Tips for managing business cash flow:
Chasing for payment
You should be chasing consistently throughout the year, however you should be extremely proactive when it comes to chasing for payment in December, thereby reducing the risk of late payment over the Christmas period.
For those invoices that fall due prior to Christmas ensure your customer has no queries to be dealt with and ask for a firm date of payment, follow up closer to this date also to ensure payment will be made.
Planning your time
Don’t assume that your customers will finish for Christmas at the same time as you, some companies will take a longer break, others will take shorter; therefore it is a good idea during the lead up to Christmas to ask your customers when their Christmas shut down is, make a note, and ensure your chasing occurs prior to this date.
Plan ahead
Some of your invoices may fall due over Christmas, and in cases such as this, your customers won’t actually be present in the office to make payment. It is perfectly reasonable in cases like these to politely ask for payment in advance of their shut down.
However, it is understandable that some will not be receptive to these requests, in such cases you should ask when they re-open and let them to expect your call upon their return to work.
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