‘Tis the season! And with the season of holiday joy also comes preparing your small business and its finances. Being one step ahead of the hustle and bustle of the holiday season is all about forecasting cash flow, hiring seasonal help, and managing the marketing budget, among many things. These are critical for creating strong financial confidence during the holiday season.
How to Prepare Your Small Business Finances
Planning in advance for small business finances is also critical for keeping sales coming in, boosting profits, and minimizing headaches. Here are some best practices for keeping your business running smoothly during the holidays.
1. Plan out your budget early
Planning around a holiday budget is one of the most effective ways to stay on top of spending, which includes both essential and non-essential purchases. Firstly, start by listing out all your essential items and be as specific as possible. Then determine what you can spend on any non-essential or last-minute, unforeseen purchases. All of these items should be divvied up and fall within your pre-determined budget limit.
2. Forecast business cash flow and expenses
A great way to forecast your cash flow and available capital during the holidays is to analyze your metrics from last year’s holiday season. How were sales performing, and what steps were taken to create sales? Were there any unexpected expenses or emergencies that impacted capital? Did you meet, exceed, or fail to reach your financial goals during that time period? If sales and costs have changed, you may need to adjust your investment approaches.
3. Take advantage of holiday marketing
The holiday season is a perfect time for reaching existing customers as well as bringing in new ones through strategic, tailored marketing. Many companies boost their marketing budgets during this time to allow more room for holiday-related campaigns and advertising. Once you’ve determined your overall end-of-year budget, see how much you can set aside for investing in a strong marketing plan, and be sure to use data about your customers’ needs, historical buyer behavior, and current trends.
4. Hire seasonal staff
If it falls within your budget, hiring seasonal staff can help take some heavy lifting off full-time employees’ shoulders while also increasing productivity and improving customer service. However, hiring them sooner is better so you have ample time to train them fully. Improperly trained seasonal workers can conversely add to the stress of an already fast-paced time of year for businesses.
Reach Out to a Financial Professional
Preparing your small business finances for the holidays is a busy and oftentimes stressful time for everyone. To help ease some of the burden, talking to a financial professional can give you some additional assistance in setting up a concrete and comfortable financial plan to round out the year. To help point you in the right direction, you can reach out to the team at Republic Bank of Chicago or call directly at 800-526-9127.
