Retail, transportation, and manufacturing are the top industries looking for holiday seasonal business funding. They’re not the only ones affected, though. Restaurants, entertainment and hospitality also see a surge in sales from the mobility and open-wallet-spirit of consumers during the holiday months.
Just like summer seasonal businesses, the winter seasonal businesses need an injection of cash to get operations moving as well.
The best time to inject holiday seasonal business funding into a retail industry company is October, so act fast. Thankfully, online funders like FundKite can transfer working capital to a merchant’s bank account in as little as 72 hours or less.
Reasons To Need Holiday Seasonal Business Funding
Employee Expenses – Holiday bonuses and other expenses are a main contributor to productivity and company loyalty, but employee needs combined with business invoices can cut into cash flow.
Q4 Expenses – The end of the fiscal and calendar year can bring many unfinished invoices and contracts to need closing, from both accounts payable and accounts receivables.
Reduced Income – Not all businesses benefit from the holidays. Summer seasonal businesses will close or see a major slow down, but other industries like manufacturing and farming saw their holiday prep occur over the summer months.
Off-Season Upgrades – For businesses that are slow during the holidays, now is the time to improve software, buy new equipment, expand to a new location, remodel or complete other projects.
Less Profit, Higher Volume – In order to keep prices competitive and make more sales, profit margins are decreased. While this may raise the overall revenue, lower per unit profits can impact available cash flow for hiring seasonal workers and buying inventory and supplies for Q1.
Storage and Equipment – Higher inventory means more storage until it’s sold, or even more retail space to sell and merchandise. Depending on the business, renting or leasing equipment may help serve the temporary needs of holiday rushes. Financing can help fulfill these orders.
Tips To Manage Your Cash Flow & Expenses During the Holiday Season
During rushes and surges, balancing cash flow can be stressful. Most business owners use the previous year to predict the current year, but there are always outside factors to consider that cause uncertainty.
A must-have for year-round account management is to utilize online accounting and inventory software. This will help track invoices owed to others and due to your business, cash flow projects with potential growth included, inventory, sales, and even a CRM to manage customers.
Prepare early. Even October is already getting late. Orders for inventory should arrive in October to give you time to restock mid-season if needed.
Have an emergency savings ready. A safe amount to have is three months of capital to cover operations, but even this is an overly idealistic goal for most businesses and the profit margins they operate with. If an emergency savings is hard to build, a credit card at hand can have a similar effect, just in the opposite order of spending then paying, rather than saving then paying.
Mismanaging your cash flow and expenses during the holidays can lead to further financial issues. Holiday seasonal business funding can help you have a profitable holiday season without any avoidable hiccups.
The Power of Forecasting
Business owners should take a look at their prior year expenses for the holiday season, in addition to anticipating how seasonal business trends may impact their sales and revenue picture. If anticipated costs exceed available working capital. Calculate how much is needed to meet needs and what rates are affordable, as well as what terms would be needed to pay back the money.
Short term funding is a popular option for holiday seasonal business funding because of the rapid surge. Money is quickly spent to prepare and quickly returned through sales within a matter of months.
Think your business could benefit from short term funding this holiday season? Call us at Call (877) 502-5003 or fill out our online application and a FundKite funding specialist will contact you.