Planning, diversifying revenue streams and using a business line of credit are key ways to effectively manage cash flow.

What distinguishes a seasonal business that succeeds from one that doesn’t? Effective cash flow management. The cycles of seasonal business can be a challenge even for long-time owners. Folks who serve tourists, as well as landscapers, lawn care pros, tax preparers, farmers market vendors and many others, need to plan carefully to be profitable. The tips below can help seasonal business owners better manage cash flow.

Know your expenses and their timing

Business expenses don’t disappear when a “see you next season” sign is hung. Payments for things like rent, insurance and taxes must still be made.

Make a list of all your expenses and when they need to be paid. Include:

• Utilidades
• Alquilar
• Los Impuestos
• Inventario
• Consumibles
• Seguros
• Repair or replacement of equipment or vehicles
• Marketing
• Accounting and tax services
• Any other expense vital to your business

Use your expenses list in combination with an up-to-date estado de flujo de efectivo to see how much money is on hand and what’s going out.

When possible postpone discretionary expenses until peak season to help manage seasonal business cash flow.

Naturally, seasonal business income has peaks and valleys. When cash is coming in set aside money to cover expenses during slow or down times.

Seek ways to diversify revenue streams

Many seasonal businesses ease cash flow by providing products or services in the off-season that complement their primary business. For example, many lawn care services offer snowplowing in the winter.

Consider how your business might diversify your revenue stream to bring in more cash year round with these idea starters:

• Subscriptions—example: a jam of the month
• Promote the shoulder season—the weeks just before or after peak season can become more enticing with special offers
• Incentivize early birds—offer an additional service or dollars-off to customers who book and make deposits in advance
• Identify new customers—example: an events space that hosts weddings could also host corporate events

Stay connected in the off-season

Maintaining engagement with customers in the off-season helps build excitement for the upcoming season. Use social media and emails to strengthen existing customer relationships and foster new ones.

Giving folks a preview of what’s new for next season and promoting shoulder-season deals are just two ways to use your content to stay top-of-mind with customers.

Leverage a business line of credit

For some businesses, their cash reserves will support them through the slow season. However, many seasonal businesses use a linea de credito comercial as a strategic tool for smoothing out the ups and downs of cash flow.

If you’re new to business lines of credit, our oficiales de préstamos comerciales can answer your questions about this cash flow management tool—and all Consumers financial services for businesses. We love helping our business members succeed, including those with seasonal businesses.

 

Todos los préstamos están sujetos a aprobación. Las tasas, los términos y las condiciones están sujetos a cambios y pueden variar según la solvencia crediticia, las calificaciones y las condiciones de la garantía. Garantía federal de la NCUA