August is a good month for retailers to pause and look ahead to the holidays and the cash flow you'll need to get there without too much sweat.
While August may be slow in terms of customer count unless you do a great business in back-to-school, August is a time to examine your revenues and expenses through the rest of the year.
Many demands will be placed on your cash flow as the holiday shopping season heats up. While these strategies are primarily designed to help you in the last quarter of the year, they must be implemented in August to be effective.
Here are six cash flow tips that will help you best place your energies:
Invest in Inventory – You already know over half your business will be conducted from Halloween until the end of the year. Be proactive for this opportunity. Buy appropriate holiday stock early to get substantial discounts (but be careful of manufacturer bundles) and to ensure that you have plenty of inventory the holiday season. You'll pay too much if you wait until the best-sellers are sold out. Don’t be too afraid if you overbuy, just clear it all out by the holiday event.
Review Your Employees – Employee reviews, which should be done every 90 days are especially important in August. Now is the time to determine which employees are keepers and which should go. Then come up with a plan to train them how to sell. There is no sense wasting valuable payroll dollars on dead-weight. If you hate working with them when it's slow, you will make yourself miserable when it's busy.
Get Vacations Out of the Way – This includes your own and those of your most valuable employees. August is down time and you can afford to run a leaner ship. If you forget this, your best people will try to take their vacations as it gets busier and that will cost you sales.
Keep an Eye on Payroll – One of the most overlooked and easiest ways to immediately improve your bank account is to reduce hours during the summer months. This task can be accomplished by lowering hours across the board or empowering managers to let people leave early during slack times. It’s a win-win situation as your employees love having some more free time during the summer and your bank balance appreciates the break. It also would be good to look at any overtime when demand is lower as a chance to change your master schedule.
Hold back – A temptation when it is slow is to build or buy things. That's fine as long as your working capital shows you have the cash to pay for it. Otherwise, wait 'til it is busy and you have the money; you don't want to add to your stress of an unknown holiday season.
Take A Short Break and Reevaluate Your Store – Your bank account during the summer can be impacted by everything from the shrinkage of fancy leather shoes left too long in the heat of a display window, to a malfunctioning front door that increases your energy bill, to an employee who turns the thermostat down to 60 and freezes up your A/C necessitating a service call.
Take a break and do a walk-through. Look for simple and affordable fixes that will increase your cash flow. It’s easier than you think.
Get our weekly newsletter updates. Read our mailing consent T&Cs here
The 5 Shifts Brick-and-Mortar Retailers Are Making to Generate Up to 20% Higher Profits Every Month
Are you a hungry brick-and-mortar store owner who’s ready for a fresh, people-obsessed strategy? This training is for you if you want to grow your business using a powerful customer experience formula proven to make your cash register chirp.