Retail stores are abuzz in December holidays! Holidaymakers' are swarming through different cities, towns and shops where they’ve decided to pack their cars, jets and bags and decided to rest for the holiday season.

For them, it’s the time of year they have been patiently waiting for.

If you’re rolling your eyes and saying things like “I wish”, then you’re probably in the other percentage of businesses that tend to clam up at the thought of “this time of year”. It usually means quietening down, consumers and other businesses that generally purchase from you decide to hold out until the new year before making any business financial decisions and generally a time where the revenue is going to suffer a bit.

So, while there are those who are celebrating the holiday's arrival, the ones that require all the help they can get, are the SME’s that won’t be in such a champagne-popping mood. But just how do we help the business get through this low-income period and face the holiday slump without losing too much? Your business is still opening its doors day in and day out, your staff still expect the end of year bonuses and at this stage, you don’t see any light at the end of the tunnel. The truth is, no matter how gloomy the picture you’ve painted yourself might appear, it’s not that bad when you consider your options!

What options do I have?

A good place to start is figuring out exactly what the problems are that your particular business struggles with at this time of the year. Can you afford to pay all business debt and it’s just the staff bonuses that are a problem? Or are you not even making day to day ends meet over this period and paying all your suppliers late?

There are ways and means to solve these problems, but they come in the form of different products. A good example of the problem, just mentioned would be invoiced business financing, whereas operational issues that render you unable to open your doors or lack staff could mean an entirely different financial product. The bottom line is that there are all kinds of options available to you, depending on the severity of your situation, and you will get through this period if you opt for one of them.

Understanding how invoice financing can help your business

This solution covers the large majority of the problem SME’s face during the holiday period. Choosing invoice financing can really carry your business through to the following month since the only issue you’re having is a slow account receivable problem.

What is Invoice financing exactly? It is quite simply a way in which businesses are able to borrow money against the outstanding amounts owed by customers. If you have 20000 New Zealand dollars outstanding from customers that only intend to pay in January, you can sell those invoices for immediate payment to a financier that offers invoice financing. What this invariably does, is increase the cash flow and thus, growth of the business. It also provides funds to pay bonuses to staff and suppliers where monies might be due. It’s all temporary since the customers will be paying in the near future, but it simply ensures that operations can continue. 

When invoice financing won’t cut it

There are other businesses that solely rely on feet through the door and don’t deal with customer orders at all. For these businesses that struggle with cash flow and rely on money walking through the front door, they might depend on business loans to help them get some revenue in for the month, otherwise, cash flow goes out the window, staff get restless and suppliers don’t get paid!

Operational disruptions

We’re all eager to go on leave at this time of the year, especially the staff. Often, the owner might realise that he has approved leave for one too many staff, or perhaps one is sick and the others are on leave. These kinds of setbacks can leave you having to fend for the store yourself or run the business because if you don’t, you might need to close your doors. Which, as we know you cannot afford to do since it’s already “that time of the year”.

So, what do you do? In future, it would be great to ensure that you don’t make the same mistake twice and cater to the staff’s leave applications according to the business requirements. Work out cycles that suit everyone – yourself included! If someone works before Christmas, they get after Christmas off and vice versa for those who go off earlier in December should return to work first thing in the new year to relieve the others.

Don’t forget the suppliers

If you’re experiencing a struggle this time of year, then you can be sure that your suppliers are too. Keep them in mind, plan for the seasonal slump and ensure that you can pay them what is due when it’s due.

In the event that you think you won’t be able to carry through this necessary task, then considering supply chain finance is the best option. This will allow businesses to collect money for goods in exchange for a discount. The funds are paid through an investor furnished fund and then later your own payments can be made as the bill becomes due.

Don’t let the holidays get you down and remember they come around every single year, so there’s no excuse why you can’t plan ahead to ensure that your business makes it through comfortably during its difficult cycle of the financial year. To stay profitable and when in doubt, utilise the resources available to you!