Tips for Managing Cash During the Slow Season

Creating positive cash flow is important for growing, investing and having peace of mind about your business. When business is steady and profits are increasing, many entrepreneurs expect those results to continue. But slow periods are normal and that’s typically when cash flow can decrease, often without warning. Are you prepared for a downturn in business? If you’re not sure, follow these best practices for managing your cash flow during slow seasons: 

Make a plan 

If you’ve been in business longer than a year, take a look at your cash flow and identify what months your revenue was the highest and when it was the lowest. From there you can determine the minimum expenses of what you need to be making and what your projected profit goals are. If you can estimate how much you are coming up short, you can start putting money away to sustain yourself through slow periods. If putting away extra cash is challenging, are there services or seasonal staff you can eliminate during the slower months? 

For many businesses it’s normal to experience a post-holiday lull or a summer slump depending on the products and services offered. But sometimes economic downfalls, natural disasters or unexpected circumstances can happen without warning, which is why it’s important to have a financial cushion. 

Secure a line of credit 

Even if you don’t need them right now, securing small business loans, credit cards, and potential investors can bring peace of mind for the future. There are many ways to secure lines of credit through a bank or having a business credit card on hand should cash flow be an issue. At Flourish Media, we have partnered with Capital One to help educate lending options available to small business owners. There are more options than you may realize! 

Diversify your offerings 

There are many ways to take advantage of your existing services and skillset to create new streams of income without creating a lot of overhead expenses. Online platforms such as Shopify or Etsy have made it easier to sell products and services online. If you have a service-based business consider creating courses or a paid membership platform to package your industry expertise and create a new stream of revenue. 

Get Creative 

Challenging times in business can be opportunities for finding new, creative solutions. For example, when the pandemic began in 2020, The Black Travel Box, a company that provides personal care products to Black female travelers, released a COVID-19 relief kit to help homebound travelers find an outlet for self care. 

If the demand in the market for your product or service dissipates, can you rebrand your offerings to fit a new demographic? Or can you capitalize on a new trend that your competitors have failed to recognize?

When it comes to managing your cash flow during the slow season, proper planning and thinking outside-the-box will help give you peace of mind for running your business year round. 

Looking for ways to fund your business? Download our free business funding guide and get started today.