2017 seems to be flying by with on a couple of months to go until Christmas. It is this time of year that a lot of my business clients take a moment and plan their time off over the Christmas period.

For many in small business not only does this mean time with family and friends but it also means a stop to invoicing and sales which means that cash flow can become tight until the world comes out of holiday mode in January.

So how do we plan and budget for this time of year? This question provides the answer – we plan and budget.

  1. We plan out the expected revenue due over the coming months
  2. We add this planned revenue to our budget and take known expenses (including ATO payments)

The above two steps allow us to work out how much cash flow we will generate and how much cash will be leaving the business. By ensuring the estimates are conservative the business owner can holiday knowing that the cash flow side of the business is taken care of.

The real question I ask myself is why this is only done once per year at Christmas. My best clients follow this routine every month (some do it weekly even daily). They have the following sorted and are constantly reviewing and improving on these items:

  1. A clear understanding of where they are NOW in their business
  2. Clear goals in terms of WHERE the business is heading
  3. A strategy for HOW to get there and action items to help achieve the desired results

We call this the NOW – WHERE – HOW of business

We find that it is critical to understand where you are NOW and WHERE you want to be at the start of the process – Too often owners jump from the NOW to the HOW in their business.

If you would like assistance planning out cash flow for the holiday period please call – we would however prefer to assist you in formulating an over strategy for the business and putting a process in place for year round monitoring and improvement.

We challenge you to use the holiday period to think about your business and come to see us in the new calendar year or contact me anytime at: scott@cnspartners.com.au.