Advivo shares 4 tips for successfully managing your seasonal cash flow.
Many of the 2 and a half million businesses in Australia experience peak and off-seasons. From our years of small business accounting in Brisbane, we’ve witnessed first-hand how income can drastically increase and decrease depending on the time of year. The key to navigating this issue is to understand the best ways to manage your seasonal cash flow. Keep reading to learn how to effectively manage your finances throughout the year.
1. Identify and take advantage of your peak season
If your business experiences a lot of financial ebbs and flows during the course of the year, it’s understandable that you look forward to, and enjoy peak season. Thus, you should be taking advantage of these more prosperous times of the year to plan for the quieter months. By reserving extra income from the peak season, you will have more funds available to help your business through the quieter periods.
2. Review your expenses regularly
To do this, you must create a detailed cash flow forecast that includes past data, previous industry trends, and expected seasonal variations. This way, you will be able to identify, predict and prepare for seasons of slower cash flow. From this, you can then adjust and redistribute your resources accordingly. As experts in small business accounting, Advivo can help you design and implement your cash flow forecast.
3. Lower overheads during your off-season
To decrease the burden on your finances during your business’ off-season, review your expenses to identify any areas where you are spending unnecessary money. There may be programs or subscriptions that you are not using and therefore spending unnecessary money on – these expenses can add up quickly and affect your seasonal cash flow. We go into depth into the topic of eliminating unnecessary expenses in our Automate, Eliminate, Delegate Business Booster Event recording.
4. Explore financing options
If you still find managing your seasonal cash flow difficult, you can consider financing options such as a line of credit or a short-term loan. Being able to access additional capital can help your business cover expenses during your off-season, which can then be paid off during your peak season. As always, we recommend caution when it comes to business debt, so if you’re unsure about your options, contact Advivo: the experts in small business accounting in Brisbane.
