For many wedding professionals in the north right now, sales are slow. This might mean that cash inflow is slow too. I call this time of year ‘red winter’ – when your bank account risks dipping into the negative. YIKES!
Having a cash flow plan can help this immensely! It helps you see where you are at during the year – and AVOID red winter. If you’re interested in
Here are some things that can help:
Consider Your Clients’ Payment Structure
Typically, wedding pros take 2 payments from clients: one upfront and one weeks before the wedding. This is typically an operational decision, based on workflow.
But: what is the impact on your cash flow? If you have cash coming in year round, then it doesn’t matter. But, if you have a slow part of your season, you’ll want to specifically ask for a payment during that slow season.
Ask for 3 Payments
Here’s an example:
July and August is slow for weddings in hot hot hot Texas. I would recommend that business owners in Texas have 3-payment plans: ask for a retainer/deposit when they book their client, a second payment due July 1st, and a 3rd payment due 2-4 weeks before the wedding.
FORCE the payment to come when you need it most.
By scheduling your 2nd payment to occur during slow times you’ll ensure that you have money coming in during an otherwise slow time. There is nothing that says your payments need to follow structured windows of time. WORK your cash flow to YOUR favor. Payments could be set up as such:
- A Seattle business that asks for payments on December 1st (slow), February 2nd (slow), and June 1st.
- A Florida business that asks for payments on April 1st, July 1st (slow), and September 1st.
- A DC business that asks for payments on January 1st (slow), May 1st, and July 1st (slow).
Naturally, you can make exceptions if a client wants to break out the payments into more payments. (I’m a fan of working with the clients’ needs to streamline their cash flow too. They’re likely to book you if you can be flexible with payment plans.)
Payments from clients are less a function of your operations and more a function of your finances. When will you need the money? Ask the client for it then.