Avoid your worst business nightmares this Halloween30 Oct 2018
As darkness falls on the eve of October 31st, millions around the world wait with bated breath as the land of the living is haunted by those from times gone by. This Halloween we look at how you can avoid your worst business nightmares.
Halloween dates back thousands of years to the ancient Celtic festival of Samhain, which marked the end of summer and the harvest, and the beginning of winter.
It was custom for the Celts to build large bonfires to ward off spirits they believed revisited the mortal world on that hallowed night. In the US, pumpkins were carved for the same reason, and those the glowing orange shells were adopted into UK and global tradition in place of the seemingly less-effective turnips which were originally used in Britain.
When it comes to consumer spending, Halloween has overtaken Valentine’s Day to become the UK’s third-biggest spending holiday after Christmas and Easter, respectively.
In 2016, the British population spent an estimated £310m on Halloween, up 5% from £295m in 2015 (in 2002 it was just £12m).
Approximately 10 million pumpkins are grown in the UK every year, with 95% of them reportedly bought in the run-up to Halloween. The remainder are responsible for a variety of unpleasant delicacies, like pumpkin-flavoured soup or pie.
The lesson here is that people started carving pumpkins instead of eating them because they taste horrible, probably. You are advised to do the same.
The lifeblood of business
The surge in Halloween spending, which has no doubt take place again this year, will benefit many UK retail and agricultural businesses.
However, other businesses could be in for a fright if they’re not careful – and one that isn’t caused by your friendly neighbourhood ghosts or ghouls.
Whether at Halloween or any other time of year, suddenly running out of cash is one of the most terrifying experiences a business owner can have.
The scary thing about cash flow problems is that they can suddenly creep up on you, while others businesses may be haunted by them for the entirety of their existence. Even seemingly successful businesses with healthy sales and margins can fail if they can’t access enough cash to pay their bills when they need to.
As a small business accountant, our team have wealth of experience in helping businesses alleviate their cash flow nightmares and become a cash positive, healthy firm thanks to the unparalleled knowledge of our MBA-qualified business coach.
Are you having cash flow woes? Get in touch with us today and we would be more than happy to discuss how Accounts and Legal can help.
Keeping your business alive this Halloween
Cash is essential to every business, which is why sound cash flow management should be a key priority for your business. It begins with firmly controlling your costs, so that your spending never reaches scary levels.
Your business must remain lean and efficient if it is to stay alive and avoid joining the entrepreneurial graveyard.
Your margins should also be as high as possible, while sound credit control is essential, which means being cautious when granting credit to customers, sending your invoices out promptly and chasing payment as soon as it’s due.
Week to week, you should have a good idea how much cash is in your business bank account, roughly how much your business owes, how much it’s owed and when significant sums of money will enter and leave your business bank account.
Working with sound cash flow forecasts can help to ensure that your business remains in the land of the living.
Based on realistic assumptions of likely sales and costs, making cash flow forecasts allows you to look ahead and predict what cash will enter and leave your business in the months to come.
And if you can look ahead and see something scary heading your way, because your costs will be higher than your sales and you’re likely to run out of cash, you at least have time to act now to cut your costs, boost you sales or find short-term funding to ensure that your business doesn’t come to a gruesome end.