It’s not easy to generate most, if not all, of your revenue in only a few months of the year. But as a seasonal business owner, you’re probably used to it. That doesn’t mean you enjoy worrying about your cash flow in your off season, which is why Direct Capital is here to help ease your mind with these seasonal business cash flow strategies.
Tip #1: Evaluate your pricing and expenses.
As a business that doesn’t have a consistent revenue stream, you need to ensure your pricing strategy matches the income you need to generate. In other words, it wouldn’t be unusual for a landscaping or snow plowing company to charge a high cost for services since the majority of their business is captured in one specific season. But in order to properly price your services, you need to understand what other expenses you are paying – ordering inventory, payroll, materials for your office, new equipment, etc. Once you have a good grasp on your output, you’ll be able to better price your services.
Tip #2: Hold your customers accountable.
It’s going to be pretty hard to make money if your customers aren’t paying you for your time. It’s important as a business owner – especially when it’s a seasonal business – to hold your customers accountable to their payments. Reach out if they are late and see if there’s something you can do to ease their burden while still allowing yourself to get paid. Part of holding your customers accountable, though, is ensuring you have a proper POS system. Inc. writes, “An invoicing system that works well will be quick, efficient, and allow you to get a snapshot of which clients are current on payments and which are falling behind.”
Tip #3: Consider expanding.
We know the whole point of being a seasonal business is that you only operate in certain months. However, you need to constantly generate an interest in your company and your brand, even in your off seasons. It wouldn’t hurt to consider ways you can operate year-round, whether that is including additional products or minor services during down times. Another option would be to increase your marketing in your off-months to get new and existing customers excited to use your service or products. (And, if you need some extra cash to kick start your marketing strategy, look to Direct Capital!)
Tip #4: Use financing.
Financing becomes even more important in the seasonal business world because you need to preserve the cash you do make to use on other business needs. When it comes to purchasing new equipment or other large ticket items for your business, it’s important for you to consider financing. Leasing will help keep your cash flow intact while also paying back the equipment on your terms. Direct Capital, for example, has terms specifically designed for seasonal businesses and enables you to worry a little bit less in your off seasons.
We hope with these four tips, you’ll be on your way to having your most successful year yet!
For more information on how to grow your seasonal business with Direct Capital, visit our website or call us at 866-777-0117!