Cash Flow Management Strategies for Seasonal Businesses

Running a seasonal business can be rewarding, but present a fair share of challenges as well. One of these is cash flow. After all, when you have a boom during one part of the year and fewer customers the rest of the time, it may be difficult to plan ahead as opposed to businesses that enjoy a steadier cash flow. If you own a seasonal business, make sure you do these four things to avoid cash flow problems.

1. identify your peak seasons and slowest periods, and comb through sales data to calculate how much the business brings in on average during those times. Being as realistic as possible is key here–don’t inflate your busy season revenue or how long it lasts. If anything, underestimating these things is safer, since it’ll help you be as frugal as possible in your budget.

2. List all your expenses–and don’t forget to include variable ones. Obviously, bills you pay on a fixed schedule each week or month are the easiest to account for: wages, rent, utilities, etc. Examples of variable expenses (e.g. ones that are less regular) could include taxes, insurance, and months with three pay periods instead of the standard two. Such expenses might be every quarter or every six months.

3. Consider a line of credit for large purchases or emergencies. A line of credit is a safety net, and it’s especially important for seasonal businesses, who may need to float certain expenses during the off season. They’re a much better option than high-interest credit cards–and the best time to apply for one is before you need it!

4. Be proactive about updating your cash flow plan. Businesses evolve, and plans should too. Factor in any changes in revenue or expenses.

Contact Smart Capital Lending to explore options for business lines of credit or loans as you operate and expand your seasonal business.


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