Are You Ready for the Holiday Slowdown?
According to CreditorWatch, late invoice payments in Australia are at their highest rate since the end of JobKeeper in March 2021, meaning you might be seeing cash flowing out, but it’s not flowing in as quickly.
At Earlypay, we typically notice that as the holiday season approaches, businesses like yours can face a unique set of cash flow challenges. Customers take longer to pay invoices, sales volumes slow, and cash inflows become less predictable. This combination can make it harder to meet financial obligations, pay employees, and fund growth plans.
Here are some tips to help keep cash flow strong this festive season:
Invoice promptly
Before your customers start closing for the holidays, get your invoices issued. Sending invoices now increases the likelihood of being paid before businesses shut down, giving you more available funding to draw from.
Assess your short-term cash flow
Forecast your cash flow through to March. It's possibly not something you want to do now in the run to the end of the year with everything else that's on your plate, but it will set you up well with a clearer picture of when you may experience cash shortfalls. It can also help you factor in expected delays in payments and slower sales volumes. This will give you a clearer picture of when you may experience cash shortfalls and help you determine how much funding you may need to cover expenses like employee holiday pay, rent and other overheads.
Maximise available funding
You may already have additional funds available within your invoice finance facility. Drawing down these funds in anticipation of slower payments and ongoing costs during the holiday period can help ensure you have the cash needed to stay on track during this season.
Reach out if you need more funds
If your cash flow forecast reveals a potential shortfall, don’t wait until it’s too late. Reach out to your account manager to discuss increasing your facility limit or drawing additional funds to prepare for the slowdown.
Planning ahead matters
A proactive approach to cash flow management is essential this holiday season. By forecasting potential gaps, leveraging your invoice finance facility, and staying on top of invoicing, you can keep your business running smoothly.
Take the time now to assess your cash flow needs and put a plan in place. Whether it’s drawing down more from your facility or ensuring invoices are sent promptly, small steps taken today can make a big difference in maintaining financial stability into the new year.
Need help preparing your cash flow?
Our team is here to support you this holiday season. If you have questions or need additional funding, don’t hesitate to get in touch. Together, we can make sure your business is ready for whatever the holiday season brings.
