With the countdown to the holidays well underway, Commonwealth Bank’s Executive General Manager Small Business Banking, Rebecca Warren, discusses her top tips for preparing for the busiest trading period of the year.

“It’s been a tough year with rising input costs and the impact of inflation on discretionary spending affecting many small businesses right across Australia,” Ms Warren said. “But the festive season is typically a busy time of year when most businesses experience an increase in cash flow and customer presence. 

“We have a very positive outlook for this holiday season, and consumer and business confidence going into the new year.

“Starting with the Black Friday sales and continuing through Christmas, Boxing Day and into the January sales period, savvy Aussie shoppers are set to take advantage of the pre- and post-Christmas sales extravaganzas.

“It’s important for small business owners to make sure they are set up for success and think through ways to reduce any risks,” Ms Warren said.

CBA data shows that around 20 per cent of small businesses make up close to 40 per cent of their turnover during the festive period, between November and January. Around 10 per cent of businesses make half of their turnover during this time.

It’s a particularly important time for small businesses in sectors such as transportation, amusement and entertainment, where one quarter of businesses rely on the holiday season for at least 50 per cent of their earnings.

Ms Warren shares steps retailers can take to prepare and de-risk:

1. Forecasting demand: Prepare your inventory to meet customer demand

The best way to prepare for the likely influx of holiday business is by forecasting demand. Look at your sales history and consider your inventory planning appropriately.

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Sales trading history can help you plan for a rise in demand for particular products or services while doing some research into your customers can help you personalise offerings and tailor marketing to attract customers.

All these insights are also helpful, once you’ve made it through the silly season, to conduct a post peak review.

It’s important to take the time to reflect so you can optimise your business for the next peak period, ultimately setting up your business up future success.

2. Prioritising payments is essential to outstanding customer experience

Cards and digital wallets are the most common payment methods in Australia. The capability to make and take payments at any time is essential for your operations to run smoothly and reliably while providing customers the best digital customer experience.

Any downtime impacts your customers and ultimately your bottom-line.   

It’s more important than ever that merchants have a payment device that provides multiple connectivity options such as dual sim and Wi-Fi capabilities.

This ensures small businesses can stay connected and keep up and running, giving small businesses greater reliability and resiliency even if unexpected problems arise.

CBA provides this certainty and security to our customers. Our Smart Terminal device is fitted with two sim cards from different telecommunication providers and is also Wi-Fi enabled. In the event of an unfortunate or unexpected outage, our customers can easily switch their terminal to a new network or connection method and continue to take payments.

3. Optimise your cash flow to make smarter decisions

Keeping a close eye on your cash flow is ensures you are abreast of your financial situation and can mitigate any potential shortfalls. 

As the cost of doing business rises, making faster and better business decisions will increasingly depend on maintaining smart, real-time visibility over your cash flow.

Every business will have different cash flow tracking needs. 

CBA offers free comprehensive cash flow tracking capabilities, including monthly summaries of your incoming and outgoing cash flow, month-by-month breakdowns and real-time transaction history to help small businesses easily track their finances.

4. Protect your small business from scammers

For scammers, the holiday period is a time of opportunity.

With small business owners focused on managing what is often a busy period, scammers are busy targeting their next victims.

Scams rely on people within a business being tricked into transferring money to accounts they shouldn't.

One simple step to take is to set up a payments approval process for your business, preferably requiring multiple approvers, with no exceptions. The other is to be mindful of not publicising your movements on social media.

If you think you have been scammed or if you notice a transaction you didn’t make, contact your bank immediately. The best chance of recovering funds is when action is taken as soon as possible.

5. Consider your business resiliency

Always prepare for the unexpected.

Whether you’re a one-person start-up or a seasoned business owner with multiple staff, it’s essential to build business resilience.

Building a business continuity plan helps you prepare for the unexpected and is your roadmap to make sure you can manage when things don’t go to plan.

Done properly, business continuity planning minimises the impact of disruption on your business, customers and community. CBA has a number of free resources on our website to help with your planning.

Go to CBA Newsroom for the latest news and announcements from Commonwealth Bank.