Christmas can be a difficult time for small businesses within Macarthur, Campbelltown and beyond, as sales fall away and customers delay payments.
Follow these five golden rules to help avoid financial headaches over Christmas and into the New Year.
1. Don’t be afraid to follow up your customers.
Call your customers if their payments are late, issue statements and reminder notices. Remember many of them will have similar problems to you and will be looking to delay payment if possible.
2. Issue your invoice immediately on completion of a job.
Always check your invoices to avoid them being returned or not paid due to an error. Take the time to ensure you have invoiced all completed work before Christmas.
3. Reduce your stock levels.
You can generate cash by minimising your stock levels over the Christmas break.
If required discount slow moving stock. Strictly manage any purchases pre and post Christmas.
4. Manage your suppliers.
Speak with your suppliers and extend your credit terms if necessary. This is the cheapest form of finance. Many suppliers are large businesses that can afford to extend credit if you have been a good customer.
Remember to keep everyone, including your bank, up to date. Tackle cash flow issues early on so that they don’t develop into problems later.