Managing your cash flow over Christmas


The holiday period can account for a significant amount of sales for some businesses. For other industries it may be a challenging time of the year, particularly in terms of cash flow.

Businesses can take a proactive approach to managing their cash flow by adopting some of the following strategies:

Invoice quickly
Stay on top of your accounts receivable by prioritising collections and invoicing your clients quickly to avoid chasing up overdue accounts in the new year. Contact problem payers early with a courtesy call to check they have the invoice in their system and remind them of the due date.

Tighten up payment terms
Consider shortening your payment terms or offering Christmas early payment discounts to encourage advance payments. For large sales, you may want to consider a full or part deposit to be paid up front.

Consider debtor finance
Debtor financing is an option for those business owners who don’t want to deal with the headache of chasing up accounts. A debtor financing company takes control over your accounts receivable and allows up to 90% of your invoices to be received immediately. Your customer then pays the debtor financing company and your business pays commision to the debtor financing company. The advantage of using debtor finance is the certainty of payments over the festive season to help create a healthy cash flow.

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If you believe the matters discussed above are relevant to your business, please contact Darren Smith of our office to discuss further.


Darren is a Chartered Accountant with extensive experience, including working in the big 4 and medium sized firms before becoming a partner of a city based firm in 2000.

He has gained much experience and has extensive knowledge in providing business and taxation advice, superannuation planning, negotiation of sales and acquisitions of businesses and property development. His client base covers a wide range of industry groups.

Darren works with business owners to grow their businesses and create personal wealth within and outside of their business.


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