Ten Top Tips: How to cope with a business summer slowdown
Summer can bring unwelcome problems for businesses, especially those that are already struggling with financial problems.
Here are Graywoods’ ten top tips for businesses that are facing a difficult summer:
- Plan your company’s cash flow over the summer months. Don’t leave it to chance, make sure that you will have enough money available to cover expenses, including tax liabilities.
- Keep expenditure under review. Costs can rise up almost imperceptibly but they will threaten your company’s viability if you don’t keep them under control.
- Credit check your customers and don’t offer credit unless you are confident that you will get paid.
- Make sure that your customers know your payment terms, make it prominent on your sales invoices and ensure that all your customer-facing staff also understand your terms and conditions.
- Follow up with your customers at an early stage after you have delivered your goods or services. This will help avoid delayed payments if there are any issues, rather than leaving it until the payment falls due.
- Don’t be tempted to chase turnover by under-quoting for work. Make sure you know your profit margin and set a sustainable pricing policy.
- Promote products or services that are particularly high margin or are less complex to produce, to help fill in any quiet periods.
- Keep an eye out for the warning signs that your business finances are struggling. Important warnings include exceeding overdraft limits, missing tax payments or being chased for payment by suppliers.
- Tell your customers when you are going to be open. They may presume that you are closing or that you can’t cope with your usual production.
- Take expert advice as soon as it becomes clear that your company has financial problems. The sooner that you seek advice, the more likelihood there will be of rescuing the business.