As another harsh winter is forecast, Lloyds TSB Commercial Finance offers tips for SMEs on how to plan for the season

In 2010, 70 per cent of SMEs were affected by the harsh winter, according to research from Lloyds TSB Commercial, with the conditions costing firms approximately £7.3 billion.

This year is set for similar weather, with the Met Office predicting below average temperatures and widespread snow fall.

But it’s not just bad weather that can adversely affect businesses over the winter months. Office closures over the seasonal holidays both in the UK and abroad can add weeks, if not months, onto delivery and payment times.

To avoid being caught out, Martin Walmsley, head of debtor insurance at Lloyds TSB Commercial Finance, has put together the following ‘Five Cs’ on how to get your business ready for winter:

• Communicate - If your business has to close due to bad weather, make it a priority to inform all customers and clients as soon as possible. A note on your firm’s website accompanied by an email will ensure you are not inundated with queries.
• Contingency planning -  By making detailed plans well in advance, if your business is struck with a week of bad weather, all your employees know what to do and can work from home if necessary.
• Chase invoices - To keep bad debts to a minimum, it is essential to keep on top of all outstanding invoices by having clear payment terms in place and a system to immediately chase up late bills. This will ensure, in the event of a slowdown or closure due to bad weather, your business’ cashflow is not affected.
• Check inventory - To ensure your company is in a strong position to grow, check your inventory against your order book and historic seasonal sales numbers. If needed, pre-prepare stock before the winter to ensure your business is in the strongest possible position to capitalise on demand.
• Credit insurance - It makes good business sense to put in place a credit insurance policy, such as Lloyds TSB Commercial Finance’s debtor insurance facility. This protects a firm’s sales ledger against the risk of bad debt and customer insolvencies