As the festive season approaches and sales ramp up, we get lots of calls from small business customers who have left it until the last minute to check whether their spare merchant terminal still works.

In fact, last year, one of our customers was left without a terminal at their signature event for the year – an annual charity drive to raise money for the most disadvantaged in their community.

It’s a reminder of the need, particularly in the current economic environment, to be prepared. At a time of year when many businesses traditionally garner up to two-thirds of their annual turnover, you want to have everything in place to secure those December sales.

Standing out from the crowd

The retail sector has been particularly hard hit by rising prices and higher interest rates. Our latest NAB Consumer Sentiment Survey confirms that consumers are busily reprioritising their spending – with one in two cancelling or cutting back on luxuries like eating out and entertainment.

So it’s not surprising that the Australian Retailers Association has predicted a more frugal Christmas trading period this year, with many shoppers keen to look for bargains in the face of higher living costs.

That’s why it’s important to review your customer databases and ensure you have a compelling communication strategy.

You also need to understand what the competition is up to, so you’re one step ahead of them. Offering value for money by way of carefully crafted package deals could resonate strongly with many customers at the moment – particularly after the latest interest rate hike.

Encouraging staff loyalty

At the same time, you want to be prepared for what will still be a busy time of the year. That won’t be easy with the ongoing labour shortages, but careful planning can help here too. While a lot of small businesses can turn to family or friends for extra help, it’s still worth putting some thought and effort into building staff loyalty well ahead of Christmas Day.

An incentivisation scheme, for instance, may be a relatively straightforward way of encouraging employees to work through the holiday period. Just make sure you still have a back-up plan in place.

Don’t lose sight of security

Of course, protecting your business is also a must.

We know that in any period of heightened financial activity, you’re even more open to attack if your cybersecurity strategy isn’t up to date and your systems aren’t safeguarded. Now’s a really good time to assess the risks and ensure you aren’t unnecessarily exposed.

The festive holiday period is also when some business customers are hyper aware of the dangers of natural disasters. While you can’t change the weather, you can ensure you have a business continuity plan in place, so you know what steps to take in the event of a large-scale emergency. This will help you to recover more quickly, reducing any disruption or loss of profits.

Part of that is ensuring you’re appropriately insured – particularly if you’re going to be holding extra stock.

The upside of going slow

Not all businesses benefit from the summer holiday season. If that’s your business, make sure you make time to take a break. We all know how hard small business owners work and any quieter trading period is a great chance to rest and recharge.

It’s also a good opportunity to work on your business rather than in it. Take the time to think carefully about what might lie ahead in 2024.

The experts at NAB Group Economics have suggested we’ll see a further slowdown in economic activity over the next 12 months and it will help if you’re prepared. Think about how you can best respond to increased competition, or to higher interest rates and the inflationary environment.

You’ll also want to think about your cash reserves and where to use them. Where are the opportunities to cut costs and potentially look at new revenue lines? Maybe even consider engaging a business coach to take a good look at your operating model.

Preparing for 2024

Above all, you want to make sure you’re approaching the new year on the front foot.

While that means preparing for the potential challenges that lie ahead, it’s also a matter of readying yourself for any opportunities. If you do end up having a busy December, that includes making the most of any extra cash flowing through your business.

Ultimately, it’s important you have a plan to help your business prosper and grow beyond the festive season.