Tips to avoid Christmas cash crunch

Published 10:00am 7 December 2023

Tips to avoid Christmas cash crunch
Words by Brad Flynn

While a great time of celebrations for most, Christmas can be a nightmare for small business owners when it comes to cashflow.

On the one hand, there may be a boost in sales in the lead-up to the silly season, but on the other there are many lost days due to public holidays.

To prepare and make the most of this time of year, here are three things you can do to help smooth the cash flow rollercoaster.

Christmas Cash Flow Tips

Christmas Cash Flow Tips


  1. Keep your foot on the accelerator. Instead of easing into the break, step up your activities to make sure you maximize the sales to take advantage of if your competitors take their foot off the pedal.
  2. Do a cashflow forecast, from now until the start of February. Have a think about when cash will be flowing into your bank account and when it will be flowing out and what the subsequent bank balance will be. We want to maximize inflows and minimize outflows, so holding off on some expenses to the new year may be required.
  3. Have a cash cushion set aside. Ideally, have at least three months of operating expenses in a separate account. This will help you think clearly and not make silly decisions that will leave you in a cash crunch, spoiling your festivities.

Finally, set a reminder in your calendar for about this time next year, so you can begin preparing your cashflow and not end up being crunched.

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