Seasonality and business cycles are a certainty, but at least you can plan for them because they are predictable. For some, this is a bumper time for their business but for others, it may feel like the annual graveyard shift. Everything from holiday’s, winter months, tax season, and paydays are part of a business cycle.
If you haven’t got a clear plan for these ups and downs we have some tips below to help you prepare well and confidently enter those business periods.
Identify the cycles that will affect your business
If you don’t know, you can’t plan. Even if you haven’t been in business very long you know your industry and whether certain times of the year are slower or more profitable than others. This gives you several advantages. You can put extra finances aside for these months by adjusting your forecast accordingly, offer specials, or find ways to reduce overheads.
Build alternative income streams
This can involve partnerships that allow for shared campaign costs and reduce overheads for both parties. Alternatively, consider referral campaigns that get rewarded, highlight new products, and stay in touch with existing customers to communicate special offerings. There are many creative solutions so brainstorm ideas that suit your business and support your brand.
Put extra budget aside for marketing
Looking at the previous years’ finances can help you assess seasonality and trends to give you a good indication of when your business has quiet seasons. This can help you plan for marketing campaigns and budget. Plan accordingly so that you can put aside extra budget for campaigns, online marketing efforts, events, or special offers that require more stock at these times. But make sure you have a strategy that is relevant to your customers, you don’t want to waste these funds on ineffective marketing. If you aren’t sure how to best market your business, consider spending that budget to hire a marketing agency that can assist you.
Plan invoicing strategies
These cycles can have an effect on your cash flow as customers are slow to pay or debit order dates change. Plan for months like February that are shorter. Months like this, as well as public holidays, effect payday and debit orders. Business days are also limited while targets stay the same, in comparison to months with more working days this can put a strain on cash flow.
Know where to find quick access to funding
Sometimes you simply don’t have the budget to put aside at these times of year and you need to look for alternative funding. The banks can take a long time and seasonality just doesn’t allow for waiting around. Business lenders like Lulalend bridge this divide by offering immediate funding or a credit facility that you can drawdown from at any time to use as and when needed.