Don’t look now, but the dog days of summer are here. And unless you run a seasonal business that booms when temps rise, this means a slowdown in sales.
So if the warmer weather has you wondering—“How am I going to make my cash flow work for the next 3 months?”—have no fear. Some simple planning now can set your business up for success.
From reconnecting with your customers to building business credit, here are six tips to help keep your finances cool in the summer heat.
This summer’s to-do list
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1. Reach out and connect
You’ve likely made dozens or more of new contacts over the course of your busier months. Use the slow summer season to reconnect and strengthen ties with these folks.
You can also use this time to build loyalty by engaging existing customers and vendors.
Have you been a good customer? Ask your vendors and suppliers about extending you credit. If you’re not already, look into getting net 30, net 60 or even net-90 day terms. This will help cushion your cash flow and make the slow season much more manageable.
Also, don’t be afraid to explore relationships with new vendors or suppliers. You may find businesses that are willing to provide you with a better price or terms.
2. Conserve energy
Because energy costs soar during the hotter months, lowering your energy use can have a big impact on your bottom line.
Try to limit your electronics use to mornings and nights—before noon and after 7:00 p.m..
This will keep your space cooler. If you’re a professional working from home, plan your work activities around these hours. Businesses that need to keep regular hours should focus on running high-energy appliances during the cooler times of day.
If you haven’t already, replace your light bulbs with energy efficient alternatives. It may sound extreme, but these little changes really do add up over time.
3. Experiment with new ideas
While things are slow, don’t be afraid to test the waters. Review and update your company website, create a video explaining your business or popular products, try a new “summer only” dish, or look about doing a promotion or special offer that you wouldn’t otherwise consider.
Testing new ideas during a slow time can unlock a huge revenue stream you wouldn’t have time to experiment with otherwise. Be brave and swing for the fences! It’s OK to fail.
Things to do for next summer
1. Trim the fat
Start planning for next summer’s slowdown today.
If you know your sales will drop off for an extended period, create a plan to reduce inventory and staff hours. Your cash flow will thank you. Of course, you’ll want to give your employees plenty of notice if you plan on cutting back hours.
2. Perfect your game
Summer is the perfect time to tackle a major project. What’s something you’ve wanted to work on, but just haven’t had the time? Since most of your customers are off doing something else, disruption will be minimal. Here’s a few ideas:
Adjust your marketing plan/materials. Get feedback from people you trust.
Take a class. What would you like to learn more about that could help your business thrive?
Remodel or just makeover your retail space to give it a fresh feel.
3. Pad your cash flow
Taking out a traditional business loan or establishing a line of credit can provide you with the working capital you need for some flexibility during the lean times.
To do it right–and avoid high interest debt products–start getting your ducks in a row now by taking charge of your business credit health. Your personal and business credit will be the first thing most lenders looks at.
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Bonus! By building strong business credit, you’ll also be able to negotiate better payment terms with your vendors by next summer. Would an extra 30 days to pay for your inventory make it easier to run your business?
Now it’s your turn…What’s your secret to beating the summertime business blues? Let us know in the comment section below.