The festive feeling is taking hold as we all begin counting down to the start of the holidays.
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For many Welsh businesses, the festive season means a busy – and sometimes challenging –rush.
It’s a fact that the upturn in demand which comes every festive season creates great opportunities for Welsh businesses. Indeed, recent research from PwC found British people will collectively spend nearly £446,000 on gifts in every minute of every day during December.
To capitalise on this opportunity, many businesses in Wales have been busy planning for months. But all should take steps to ensure they don’t put themselves at risk of cash flow problems or overtrading.
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Here we share our top tips on what companies need to consider if they are to successfully navigate the frantic festive period and get 2019 off to a flying start.
- Revisit your business plan. Most firms will have created a plan of what they want to achieve over the festive period, and it’s vital that they revisit this regularly during December.
Reviewing plans will enable company leaders to take stock of their performance and alter their strategy and approach to best capitalise on the festive rush.
While most firms will be focused on Christmas, to ensure they start 2019 on the front foot it’s vital they don’t lose sight of their longer-term plans either. The New Year should always be factored into business plans.
- Understand your working capital. Over the Christmas period companies’ working capital is stretched to the limit, with businesses investing heavily in assets such as staff and stock to meet the upturn in demand.
Although firms will have an idea of how they’re going to recoup this money eventually, increased activity puts a strain on a company’s cash flow.
We’ve developed a specialist working capital management tool that helps firms to evaluate all the parts of running a business that influence their working capital and understand where the pressure points lie. With this increased understanding, businesses can then look at ways that they can safely release additional funds.
- Have the correct funding in place. Having the correct funding in place is fundamental to a firm’s success. Products such as invoice finance and asset-based lending are perfect for companies that may need to quickly inject funds into their business over the Christmas period. They allow firms to release capital tied up in assets, such as unpaid invoices and stock, which can then be reinvested in the business. In some instances, funding can be made available within 24 hours.
This year has been difficult for Welsh businesses, with economic and political events causing uncertainty. Against this backdrop, it’s particularly important that companies have robust strategies in place as they enter 2019 to make sure they can navigate any challenges they might face.
A trusted adviser can help businesses to develop these plans, and at Lloyds Bank we have a team of relationship managers who understand the Welsh market and can help our clients to prepare for all eventualities.
