Christmas cashflow – 5 tips for small businesses


It’s not many more ‘sleeps’ until Christmas, and at the top of every business’ Christmas list should be healthy cashflow!


With the festive season well underway we look at:

* why it can be a challenging time for SMEs

* the negative impact the coming weeks can have on cashflow

* our 5 top tips

* short term business finance solutions and their providers

The SME’s Scrooge at Christmas – cashflow!


Christmas can be a magical time of year and a great time for small businesses.

Last year, an article by the Guardian detailed that over 20% of the year’s revenue for small businesses is taken during this period. Despite this, it is also a challenging time as the increased revenue puts these very businesses under huge pressure as they work at capacity to meet the high demands.

Christmas is therefore a very tricky time for cashflow, as whilst your sales may be increasing, your costs are likely to rise too. Everything from more staff to inflated stock purchases and even Christmas parties and holiday pay must all be considered during this important period.

Combine all of these factors and business owners soon find themselves with less time for admin, less time for chasing payments and less time for making those stock purchases.

It’s also important to remember that other businesses are experiencing similar challenges too, and some of those businesses may well be your customers, resulting in late payments which will negatively impact your cashflow at a critical time.


Over 20% of the year’s revenue for small businesses is taken during the Christmas period


So, how can you prepare and manage a healthy cashflow over these next few weeks?

Here are our 5 top tips to keep your cashflow off the naughty list this year:


  1. Monitor cashflow – if you don’t use business accounting software to manage the business’ finances then consider doing so now. There are plenty of platforms on offer which can help give you an overview of cashflow cycles, anticipate shortfalls, identify weaknesses and even identify opportunities.
  2. Budget – drafting a clear and achievable budget will only help you keep on track. Frequent monitoring and comparison with your cashflow forecast will ensure any shortfalls in revenue or increases in costs are identified at the earliest possible stage. This way you can take necessary action and make provisions if needed.
  3. Collecting invoices invoice as soon as the work is completed and don’t let this vital admin task fall by the wayside as a result of the hectic festivities surrounding you. Delaying your invoice delivery means delayed payment. Given that it is holiday season many businesses will be short staffed which could further delay cash in. One way to beat delayed invoicing could be to offer discounts for quick payments. Discounting an invoice by 5% may encourage some debtors to pay quicker than normal. Meanwhile, if you owe money to suppliers make full use of the credit terms on offer.
  4. Stock – do you have enough stock to meet demand? It is likely that you will have certain items that sell better than others so make sure you are well stocked for the period ahead. After all, if you are out of stock the customer will only go elsewhere.
  5. Plan ahead – it is important to consider the costs associated with the Christmas period. Holiday pay requirements will play a part as well as those all-important Christmas parties! Also, preserve your cash and think about what you can possibly put off until the new year such as maintenance, decorating and repairs.


Bolster your business finances during the festive period


If you think your business needs a short-term buffer the chances are your main bank will not be able to arrange this in time.

But fear not! There are plenty of other options to consider.

From flexible overdrafts alternatives, single invoice financing and quick business loans there are many ways that you can prepare despite the tight timescales.

Let’s take look at some of the solutions on offer:


  • Single Invoice Financing – allows you to unlock funds tied up in an individual unpaid invoice so that your business receives a percentage of the funds without waiting for your customer to pay.
  • Flexible overdraft alternatives – a revolving credit facility that you can dip in and draw money as-and-when your business needs the cashflow support. The best thing is you only pay for what you borrow!
  • Business loans – arranging a short-term business loan has never been easier. Some providers like RateSetter and Funding Circle can give you a decision in a matter of hours and have the money in your account shortly after. A quick and effective option to alleviate the festive pressures!


Are these options expensive?

These options are designed specifically for short term cashflow finance and so have higher interest rates than longer term borrowing options. If the requirement is long term then read up on your options here.

Am I eligible?

With so many flexible cashflow lenders in the market, all with varying degrees of appetite, you should hopefully be able to find the support you need.

Which lenders can help?

Some quick and easy lenders are:

Market Invoice –  offering single invoice financing and small business loans, Market Invoice pride themselves in their speedy turn-around. If you would like to realise some of that cash tied up in that outstanding invoice then they could help.

Iwoca – they offer business loans between £1k – £150k for cashflow, stock purchases and a variety of other business reasons; all unsecured! If your business is still in its infancy then Iwoca could help you through the festive frolics!

Just Cashflow – borrow between £10k – £500k. They provide a quick decision, can have cash in your account within a few days and there are no early repayment charges.

Invoice Cycle – offer single invoice discounting a flexible invoice-backed short term loans, all with a super-quick turn around.


To compare lenders why not let BIZL source the best finance for you – for free! Yes, we don’t charge our customers for our service, rather we take a fee from the lender we introduce you to. Complete an online application in as little as 15 minutes, we package your application and approach a selection of lenders and present their offers to you. Once you have made your decision on which lender you want to progress with we then facilitate the application and streamline the process. It really is that simple, giving you even more time to focus on smashing those Christmas sales targets!


What should I do again?

So, between now and January make sure you monitor your budget, ensure stock levels are where they need to be, keep one eye on cashflow and, if needed, secure that financial support sooner rather than later.

And of course aside from all of that…throw a big Christmas party for your team, send sales through the roof and be sure to take time out to relax with family and friends!


Merry Christmas from all of us at BIZL!


Do you need our help?
Contact us at or even better let’s chat on 0203 1678767

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BIZL Limited (company number 10838494, registered office 66 Prescot Street, London, E1 8NN) is authorised and regulated by the Financial Conduct Authority. Registered No: 784499. BIZL Limited is a credit broker of business finance, not a lender.

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