end of year business finance
Jack Richings

Jack Richings

End Of Year Finance: Get Your Business Through Christmas

The holiday season is fast approaching, so people will be preparing for this wonderful time of the year. It is a period when families come together to celebrate Christmas and New Year and, let’s not forget, take a much needed summer holiday.

The party season is fast approaching, so people will be preparing for this wonderful time of the year. It is a period when families come together to celebrate Christmas and New Year and, let’s not forget, take a much-needed summer holiday. However, if you own a business, this period may have an impact on your operation for a number of reasons meaning that it requires some additional financial support to help it through the few weeks of the silly season.

For instance, the sort of business you have is one reason why you may need to borrow more money. If your business is involved in the retail trade then the silly season is possibly going to be its busiest time of the year whereas if you own a factory then you may be closing your operation for a week or two to give your employees a much needed holiday. We will explain why these two scenarios may require you to apply for the likes of a small business loan shortly.

Planning ahead

Individuals and families prepare for the Christmas and holiday season in advance, by doing things like buying gifts and additional food. As a business owner, you need to plan ahead when it comes to keeping your business flourishing through the holidays.

For instance, if you have prepared and monitored a cash flow forecast, you will know if your business is going to require financial support when the end of the year approaches. If it does then better to have applied for say a business loan before the silly season is upon you and have the funds in your business transaction account to be able to utilise.

Why a business may require short term finance over the holidays

Purchase additional inventory

If you own a store selling things like clothing, shoes, watches, jewellery, perfume, food and drink then your business is probably going to be busier leading up to Christmas than at any other time of the year. Therefore, it makes sense to ensure that you have an adequate level of inventory to sell to your customers. The more you sell, the higher your business’s profit and the greater income you take home to spend.

If you own a restaurant and are hosting Christmas parties, then you will need to order more food and drink from your suppliers. This will require cash flow to cover these costs.
If you own a restaurant and are hosting Christmas parties, then you will need to order more food and drink from your suppliers. This will require cash flow to cover these costs.

Short Term Business Loans

You may find a short term business loan of benefit as this would enable you to increase inventory levels prior to the silly season starting. This will help you meet the increased demand of your customers. If you sort out your inventory requirements in advance you may even be able to negotiate more advantageous terms with your suppliers thus increasing your profit margin.

Christmas and the New Year Closures

Many businesses decide to close down for a week or two during the holiday season to give their staff a break to enjoy with their families. During this period, the turnover of your business may fall but your employees will still need to be paid. If you are a generous employer, you may also wish to pay them a Christmas bonus and meet the cost of a staff Christmas party to be enjoyed by all. It’s also a good time for staff to use their annual leave, when later in the year when times are busy, you will need them.

Ideally, you will be able to meet this expenditure from working capital but if not you could consider applying for additional finance such as a working capital loan.

Additional staff for hospitality

The hospitality industry flourishes in the lead up to Christmas so running hotels, bars and venues you will be run off your feet over this period. There are loads of office parties, families gatherings and friends will be celebrating more than any other time of the year.

More sales staff needed for Christmas and Sales Shopping

The lead up to Chrismas day is crazy. Store owners need to take on casual staff to serve the influx of shoppers buying presents and food for the festive season. You’ll also have the Boxing Day sales to get ready for. This is the time people are spending Christmas money, gift cards and trying to snap up a bargain, both online and instore. You’ll need sales staff, restocking staff, warehouse staff and people to manage online deliveries.

Short term loans to cover seasonal expenses

Of course, you will want to be able to meet this additional expense from cash flow but if not you could consider applying for a short term business loan.

It would be preferable if your business had sufficient cash flow to fund this period without resorting to borrowing money. If you don’t have the available cash flow, there are a number of options. These include a business overdraft facility, line of credit, working capital loan or short term business loan.

How ALC Commercial Can Help You

ALC Commercial, is able to assist small and medium-sized businesses during these times, to obtain the likes of a short term business loan easily and quickly. Even if you or your business has a bad credit history, we still may be able to help. Apply online and one of our loan specialists will be in contact with you. We’ll discuss your requirements in more detail with a view to hopefully finding the most appropriate lending product.

If approved, a business lending offer will be sent to you and, sometimes within 24 hours of you accepting the offer, the funds will be in your nominated bank account to help you fund the holiday season and beyond.

For more information on business finance, talk to our experienced and understanding loan specialists to see how our business loans can support your business goals.

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