Contractors, and other businesses that experience peaks and valleys in cash flow, face a unique challenge in making long-term plans for their business. That’s because so much can change from month-to-month in their industry. And that goes double during seasonal fluctuations. Indeed, budgeting out for a lean period every year isn’t a contingency plan for most contractors; rather, it’s a part of their reality. (Thankfully there’s plenty of loan options for contractors available.) The good news is, contractors can avoid the pitfalls of slow months –– and plan to handle booming periods as well at the same time. Here are five seasonal issues to look out for, and how to avoid them too:
Classify this as one of those “good problems to have.” However, not preparing your company to take on a lucrative project at a moment’s notice is failing to account for a massive opportunity. Though business is likely to slow for outdoor contractors and landscapers in the winter months, it’s irresponsible to think you won’t garner any interest. And there’s no faster way to wreck a solid reputation than by being caught flat-footed when a big opportunity comes knocking. Fortunately, you can apply for a business loan quickly and easily –– so you can take advantage of an unexpected boon in the off-season.
Lack of Awareness
The phrase “out of sight, out of mind,” is an apt one to remember here. Even if you’re not bringing in many new projects during slow months, that doesn’t mean you should quit marketing yourself. Indeed, the opposite is true. Setting up advertisements at strategically placed intervals can help keep you in the public consciousness year-round. Plus, engaging with a customer at any point in a positive way will engender trust, and help you land projects down the line.
The best contractors use slow periods to perform imperative maintenance on their own operations. So providing essential training to new employees and improving software and tech are great uses of time and capital during lean months. That’s why it’s so important to have a steady cash flow during all times of the year.
Not Generating Enough Business
Plain and simple, contractors need to land contracts to survive. And if your company is struggling to land important deals, your finances are going to take a hit. However, you can help mitigate these negative effects by planning ahead, and by applying for a business line of credit to help you see out rough patches. From paying salaries to leasing equipment, remember that you’ve got plenty of funding options available to you.
Prepare for a Rush
After a slow period business will boom again. Just as the seasons change, so too do contractor’s fortunes. Don’t ever lose sight of this fact, and do everything possible to make your company ready to deal with a glut of projects in a short period of time. In the contracting world, you need to make hay while the sun shines.
The Bottom Line
The truth is, a little extra cash can go a long way for contractors. So don’t hesitate to apply for an injection of funds when your business needs it most. You can contact the National Business Capital team to help you cover costs or take on that next big project. Plus, you won’t get the third degree like you would at the bank. For more information, download our free eBook and see why we’ll say yes even when banks say no: