Identify your seasonality
Plot 24+ months of monthly revenue and cost. Most UK SMEs see one of:
- Christmas peak (retail, hospitality, gifting)
- Summer peak (tourism, weddings, ice cream)
- Q1 dip (post-Christmas hangover, January VAT)
- Q3 dip (school holidays for B2C)
Three planning techniques
1. The seasonal reserve
Build a cash reserve during the peak equal to 2 × the deepest monthly trough. Ring-fence it in a separate savings pot.
2. Smoothed VAT
If your VAT bills land in your worst cash month, ask HMRC to change your VAT quarter end so the deadline lands in a stronger month. (You can request once every 12 months.)
3. Counter-seasonal lines
Add a product or service that peaks when the core business troughs. Wedding photographers shooting corporate work in winter; hospitality groups doing event catering in shoulder seasons.
Financing the trough
- Annual overdraft renewal in your strongest month — banks lend on trailing 12 months
- Invoice finance for large B2B clients
- Stripe Capital / Tide / Funding Circle — fast, often cheaper than overdraft for short-term gaps
The seasonal P&L view
When reviewing performance, compare to the same month last year, not to last month. A seasonal business comparing November to October will always look like it's exploding (or collapsing).
Use our cashflow planner to model 12 months of seasonal cash.