As the nights begin to draw in and we say goodbye to the ups and downs of our typically British Summer, we set our sights to the Autumn and Winter ahead.
For seasonal businesses this could mean a dip in activity. In this article we take a look at seasonal business loans and whether they could be the answer to plugging your short-term cashflow needs.
A seasonal business loan can help meet the needs of seasonal companies such as some leisure, retail and agricultural businesses.
By taking a short term loan it could help you to manage cash flow or provide finance to invest in the business.
There are two key ways a seasonal business loan could help.
1. Covering cashflow during down-times
Let’s say that you are running a farming business. The winter months could be a time where your crop or livestock are not earning as much for you as the summer months.
However you must still pay for any vehicle repairs, equipment replacements or costs such as tax bills or staff costs, despite a fall in your sales turnover.
A short-term business loan could provide the finance to cover these costs, and the duration of your repayments can be spread into the summer when your income picks up. This allows you to spread the finance across your uneven peaks in income.
2. Giving your business a kick-start as you begin your peak season
Another reason to take a seasonal business loans is to invest in the growth of your business.
Let’s say that you are running a business providing heating and gas services. You just have just taken on a new, big client to work for over the winter months, but because the winter has just arrived you do not have the equipment or staff to meet their requirements.
A seasonal business loan could help you take a short-term cash injection to take on new staff, new vehicles or buy new equipment to complete the job. Then using the income generated you can repay the borrowing over the coming months. This means that you didn’t have to turn away the new business.
Contact our business loans team
If you would like to discuss how we can help you access a seasonal business loan please contact us, or request a call back via the form on this page.