Forget the hearts and flowers, a healthy cashflow is all Blackpool businesses need to feel the love this Valentine’s Day said one finance expert.
Martyn Kendrick, regional director for Lloyds Bank Commercial Banking in the North West which has committed to lend £1.3bn to North West firms this year, said Fylde coast retailers, bars, hotels and their suppliers need to ensure they have enough staff, stock and equipment to make the most of the additional business.
He said: “Businesses across Blackpool will already have an idea of when they’re set to experience peaks and troughs of activity, and planning for key dates like Valentine’s Day, Easter, summer holidays or the Illuminations, means they can invest in their success without running the risk of overtrading.
"Fortunately, there is help is in the form of a specialist working capital management tool that allows firms to evaluate their cash flow.”
"There are some events, however, that can’t be anticipated. For example, if the UK suddenly experienced a scorching summer heatwave, it could lead to a rise in hotel bookings as well as boosted takings for bars and restaurants as sunseekers descend on Blackpool's Beaches.
"Firms that fail to take proper precautions could be left stretching themselves financially to meet the upturn in demand, leaving them feeling a little hot and bothered.
"This is where short-term solutions such as overdrafts, business credit cards or short-term loans could offer firms the flexibility they need to take swift action.
"But it’s not just bars, restaurants and hotels that would be left having to think fast in this scenario. The businesses that supply the hospitality and leisure sector would also face a sudden surge in demand and need to closely manage their working capital or risk losing valuable business.
"We know from our latest Working Capital Index that businesses across the North of England have a total of £116.4 billion tied up in the day-to-day costs of doing business. This is cash that can be released and reinvested to ensure firms are properly staffed, stocked and ready to meet the spike in demand.
"A first practical step businesses could take is to invoice and collect debts on time or even early. If this isn’t possible then longer-term, flexible financial products such as invoice and asset finance can help support businesses through both the challenges and rewards that seasonality can bring.
"Invoice finance, for example, allows suppliers to release up to 90 per cent of the value of an invoice, typically within 24 hours. This would provide them cash to use elsewhere, such as in purchasing extra stock."