Small Businesses Prepare For The Biggest 10 Weeks Of The Year
With only 10 weeks left until Christmas, Bibby Financial Services is calling on business owners and managers to ensure they have the cash in place to make the most of the seasonal opportunity.
According to Bibby Financial Services’ own data, October can be the busiest month of the year, with a higher volume of invoices flowing through the system than any other month. This reflects the fact that across the board, companies are placing orders and building up their inventories ready for the Christmas rush.
To meet the demands of the countdown to Christmas, firms must work to get their finances in order and ensure they have the systems in place to get paid promptly, fulfill orders and above all, keep the cash flowing.
Edward Rimmer, chief executive of Bibby Financial Services, the largest, non-bank provider of invoice finance to small businesses in the UK, says: “October is an important month for small businesses and it is often make or break time. With the current economic situation, it is vital that firms seize the opportunity to increase sales, get as many orders out of the door as possible, grow market share and potentially achieve those all-important end-of-year targets. Failure to get the systems and cash flow in place to fund orders could mean the difference between success and failure.
Managing cash flow is no mean feat at this time of year as many small businesses have to buy significant amounts of raw materials and goods and pay wages before receiving payment for fulfilled orders. However, companies who effectively master this challenge can reap significant rewards.”
To make the most of the countdown to Christmas Bibby Financial Services has the following tips:
- Keep the cash flowing – when taking on more work, it is important that you have adequate funding in place. Otherwise you could find yourself in a position where you are unable to fund new orders and have to turn customers away as the business peaks. Invoice finance is one such option which can help improve cash flow by releasing the cash tied up in unpaid customer invoices as they are raised guaranteeing an ongoing flexible supply of working capital
- Tighten up – make sure the terms and conditions on your invoices are watertight so that your customers know when you expect payment
- Get smart – don’t wait for weeks to go by before you chase for payment. Make sure you follow up invoices promptly and keep pursuing payment. Alternatively, you could enlist the support of a company like Bibby Financial Services that can take on the entire process of chasing and collecting customer payments as part of its invoice finance facilities
- Stock up – Christmas sales can often be hard to predict so cater for all possibilities. Talk to your suppliers to get flexible ‘sale or return’ deals that allow you to return unsold stock.
- Review suppliers - Are you getting the best deal from your suppliers? -Shop around and negotiate longer credit terms (you don’t get if you don’t ask!). Suppliers are keen to keep as much business as they can so take advantage of any special deals on offer
- A helping hand – Don’t underestimate the importance of having enough staff on hand. Whatever sector you operate in, you are likely to be swamped with extra customers needing help and advice in the run up to Christmas. Make sure you have a loyal, motivated and sufficiently trained team of employees behind you to achieve your business goals