Home » Blog » How to prepare your small business for the end of year surge

How to prepare your small business for the end of year surge

If you're expecting trade to increase over the summer period, then it's important you consider laying the groundwork now so you’re in a good position to capitalise on the potential increase in customers later.

Here are some tips to help get your end of year ducks in a row:

Review your cash flow

“For business owners who struggled earlier this year – those in hospitality or tourism, for example – this is an important time, even more so this year,” says Rob Drower, Partner at New Zealand small business consultancy, Prime Strategies Group.

Savvy business owners should start putting things in place to secure a healthy cash flow to see through the end of year period, he suggests, such as chasing unpaid invoices and putting aside cash for typical EOY expenses, like holiday rate payments.

If you’re having trouble getting customers to pay invoices on time, you could try offering a small discount to incentivise them to pay early. This way, you know you’ll have a little more cash to play around with when planning your end of year business strategy.

“Small business owners should spend considerable time doing cash flow projections, looking at inventory and how they could fund more stock,” says Drower. “And they [should make] arrangements for business finance if they [come up short].”

Sort out necessary inventory

Having enough stock is essential for maximising seasonal trade.

For Nicky Henry, owner of Wellington’s Skin by Nicky, maintaining supplier relationships is key to ensuring there’s no hitches when it comes to receiving extra stock for the holiday season. She suggests checking in with suppliers early to find out about their shutdown periods and placing orders accordingly. You don’t want to account for a shipment of stock and then find out that it won’t arrive until 2021.

While 2020 has proved to be quite unpredictable, Henry says that looking at historical sales and knowing when the EOY peaks usually come in your business means you can better forecast stock volumes.

Henry is currently doing one and a half times the trade she usually does. She attributes this, in part, to clients spending what would have been international travel funds on other things this year. She’s had to adjust her stock levels accordingly.

Review your staffing plan and make hires

Busy times often call for more hands on deck. Have you got enough people to help guarantee no potential customer is going to be left unattended? Now might be the time to start locking in any extra hires, leaving enough time to find the right people and ensure adequate onboarding before the busy period begins. If cash flow is an issue, business finance might help bridge the gap.

Anna Jones, owner of supermarket New World Ngaruawahia, recommends asking staff to fill out their annual leave requests early, so you can get a good read on who will be around. You don’t want to be left short staffed during peak trading times.

While you might have once relied on international travellers to fill casual positions over the summer, that is unlikely to be the case this year.

However, the unfortunate reality of COVID-19, says Drower, is a surplus of talent. “A large number of people have been made redundant and are looking for work opportunities.”

You might just need to utilise different avenues to find them. Drower says a cost-effective recruitment approach is to post on digital job boards and Facebook groups that are related to your industry.

Then there’s the question of whether you should hire temps or casuals?

“The difference between casual and temporary employees is that casual employees can be called on an ‘as required’ basis,” says Drower. Temp workers, however, require a fixed contract for a specific timeframe, which includes guaranteed hours.

It’s important to remember that casual workers are under no obligation to accept shifts offered to them, so their services should be thought of as ad-hoc.

Start marketing to your customers now

Henry says take the time to nurture relationships with your customers now so they’re loyal to you when the busy period kicks off. She’s also using this time to promote her expected Christmas best-seller and encouraging loyal shoppers to pre-order ahead of the rush. This way, she has more cash in the account upfront.

If you’re not in a good financial position after the pandemic, Drower suggests running a sale promotion for a quick cash boost. The added advantage is that you’re getting in front of new customers ahead of the holiday rush and clearing excess stock before heading into 2021, he says.

Primary CTA illustration
You believe business loans should be simple. We believe it too. That's why we offer a hassle-free approach to business loans with funding possible in 24 hours.
Apply today
Primary CTA icon
You believe business loans should be simple. We believe it too. That's why we offer a hassle-free approach to business loans with funding possible in 24 hours.

The information on this website is provided for general information only and does not take into account your personal situation. You should consider whether the information is appropriate to your needs, and where appropriate, seek professional advice from financial, legal and taxation advisors. Although every effort has been made to verify the accuracy of the information as at the date of publication, Prospa, its officers, employees and agents disclaim all liability (except for any liability which by law cannot be excluded), for any error, inaccuracy, or omission from the information for any reason, including due to the passage of time, or any loss or damage suffered by any person directly or indirectly through relying on this information.

Keep reading

Tips on managing working capital for resilience and growth

08 June 2021 | 5 min read

Understanding and managing working capital is critical to small business resilience and success. Here are simple tips to help manage working capital like a pro.

View more

Four ways to chase payments without losing relationships

18 March 2021 | 4 min read

Find out how small business owners are balancing the tricky task of chasing payments for EOFY with maintaining relationships when times are tough.

View more

How the tourism industry is preparing for 2021

07 December 2020 | 5 min read

While Kiwi tourism businesses have had a tough 2020, there's plenty you can do to help make 2021 your for the taking – just ask these experts.

View more

Subscribe to the Prospa Blog

Be inspired! Sign up to Prospa’s newsletter to receive tips, tools and small business success stories straight to your inbox.