With the busy season on the horizon, you might be in a bit of a difficult position as a business owner. Perhaps you require a new piece of equipment to tackle an end-of-year project from an unexpected source, or maybe you need to bring more equipment to the floor as a way to support increased staffing. Either way, meeting the demands of the holiday season can be expensive if you’re using traditional forms of lending.
But what if you could manage your cash flow better, acquire the new asset you need, and tackle the busy season, all with a single choice? This is where seasonal business asset finance comes in.
For today, we’re unpacking what it means to acquire an asset using asset finance, and how it can help you to stabilise your end-of-year cash flow to stay liquid in the busy months. Let’s go.
Why is looking after your busy-season cash flow important?
We don’t have to tell you that when the high season arrives, cash flow can become a bit tight. If things start to swing wildly from delayed payments, stacking invoices, or cost increases, then as a business owner, you’re put in a delicate position. There’s a balance to be struck between keeping up with orders and keeping the lights on.
In these times, managing cash flow is about sustainability more than immediate survival. If you can keep your cash reserves steady while investing in something that will help you grow, then you’re better positioned to make the most of your busiest months (instead of playing catch-up once the rush ends).
That’s where seasonal business asset finance becomes a game-changer. It gives you access to the tools and equipment you need to boost your business’s performance without tying up capital that should be allocated to day-to-day operations.
Do you qualify as a seasonal business?
Many different businesses can be considered ‘seasonal’, not just those that rely on the holiday season. Essentially, if your income fluctuates in any way associated with the time of year, then your business fits this profile. Weather, holidays, even customer demand; all of these things can impact industries in unique ways, like:
- Construction and trades, which tend to peak in warmer months.
- Agriculture and horticulture, tied to planting and harvest cycles.
- Retail and e-commerce, with their year-end booms.
- Tourism, hospitality, and events, most of which tend to rely on holiday periods.
Understanding your unique kind of seasonality helps you to plan smarter. Once you’ve spotted the highs and lows in your cash flow, you can time your financial decisions around them (including picking up some asset finance to expand your capabilities at the right time).
How does seasonal business asset finance work?
At its core, seasonal business asset finance allows you to purchase (or lease) business-critical equipment using the asset itself as collateral. Let’s say you need to expand your fleet with a new vehicle that accomplishes a specific task (i.e., hauling equipment from one site to another). Seasonal business asset finance would provide you with immediate access to the vehicle without draining any of your working capital.
The real advantage comes in the repayment structure. Unlike a traditional business loan with fixed monthly payments, you can tailor a seasonal asset finance plan to suit your payment cycle. That might mean setting up larger payments during busy months when your revenue is strong, and defaulting to smaller payments in quiet periods to ease the pressure on your cash flow.
This is what helps to keep your finances predictable, even when your revenue is decidedly not. Plus, since you’re financing income-generating equipment, the asset you choose can often pay for itself by boosting your output or productivity in the busy season.
Tips for making the most of your seasonal business asset finance:
- Time it right. As much as reasonably possible, plan to have your equipment ready before your busy season begins. The earlier you finance, the more time you have to boost your income with the new piece of equipment.
- Focus on assets that will create financial returns. When and where you can, focus on financing assets that directly contribute to productivity or sales for your business. The best kind of equipment will always be the kind that earns its keep.
- Work with a specialised lender. Select a finance partner who understands the unique dynamics of your industry’s seasonality. A lender with strong experience in seasonal business asset finance can structure repayments to suit your real-world cash flow.
More than any other type of finance, seasonal business asset finance gives you some serious flexibility. You can grow, adapt, and stay liquid when it matters most, rather than dipping into your reserves.
This doesn’t necessarily work for everyone, but if your workload ebbs and flows with the calendar, it may be time to explore an asset finance solution tailored to your cycle, rather than against it.
Heading into the busy season? Discuss a seasonal solution with GVK Finance.
Join thousands of satisfied customers who love GVK Finance. We have a genuine interest in how your business is run, and we want to help you find the best solution for seasonal business asset finance.
Get in touch with one of our financial specialists today to get started!