Thriving Through Seasonal Cash Flow Challenges: Strategies for Seasonal Small Businesses

According to the U.S. Chamber of Commerce 82% of small businesses fail due to cash flow problems. Many seasonal small businesses fail due to lack of cash during the slow season to pay fixed costs such as mortgages and utilities. Cash flow management can be difficult for seasonal small business owners to navigate as there is little time for administrative tasks during the busy season and the slow season can be anxiety ridden due to low cash reserves. This paper proposes five strategies for seasonal small businesses to manage cash flow during the busy season for use in the slow season. The cash flow management strategies proposed are supported by existing literature and examples for cash budgeting, forecasting, and cost-volume-profit analysis strategies. Seasonal small business owners from any industry and those who advise seasonal small business owners may benefit from the strategies proposed in this paper.