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Understanding SMEs’ Christmas pressures

At a glance

  • 49% of SME owners have worked on Christmas Day
  • Reduced staff numbers, cash flow problems and supplier delays can all create extra challenges over the festive period
  • Brokers can use our top tips to help their SME customers ease festive pressures

Christmas is a time of celebration and relaxation for most, but it can bring extra challenges for owners of small businesses. From supplier closures to staff holidays, the festive season can put extra pressure on SMEs, resulting in many having to forgo the celebrations.

According to Zurich’s latest SME Risk Index, almost half (49%) of decision-makers say they have worked on Christmas Day, with a staggering one in five (18%) having actually gone into work. One in ten (9%) have missed their children’s nativity play due to work pressures, and 14% have not taken any annual leave at all this year.

“Running my own retail business means I only get Christmas Day off and I will be working long hours during the Christmas period,“ says Greg Foster, owner of Decade Store in Guildford.

“I don’t get to see my family as much as I would like, due to the added pressure in December to compensate for a quiet trading period in January.”


With decision-makers facing a number of extra challenges, this time of year could be an excellent opportunity for brokers to offer a helping hand and strengthen relationships with their customers.

We’ve put together some top tips to share with SME customers, which could help to ease pressure and allow them some respite during the festive season.

Managing staff

There are three public holidays over Christmas and New Year, and many staff will want to take additional leave around these. Winter weather can also contribute to staff sick days and absence due to an inability to make it into work in severe conditions.

Reduced staff may account for much of the extra pressure decision-makers feel during the festive period, making it especially important to manage staff numbers, workloads and tasks.

Most businesses will have annual leave policies that ensure enough people remain in work to keep the business functioning. It is also advisable to make an extra effort to ensure any important work is completed, especially if the office is closing for any period of time.

Cash flow issues

Christmas bonuses, overtime pay, and extra outgoings can all increase spending over the holiday season. With banks and other businesses also under-staffed or closing over the Christmas period, this can make it difficult to chase up payments from debtors, affecting cash flow and putting strain on a business’s balance sheet.

To reduce any risk of insolvency, SMEs may consider issuing invoices earlier in December than they typically would, altering standard payment terms temporarily, or even looking at short-term financing to smooth out any potential cash-flow issues.

Supplier delays and customer communication

For some SMEs, especially those in retail, Christmas may be the busiest time of year. However, while some businesses may be looking to capitalise on an upturn in demand, their suppliers could be winding down.

SME Risk Index results

  • 32% have sacrificed Christmas festivities to check and send work emails
  • 9% have missed their children’s nativity play
  • 14% have not taken any annual leave this year
  • 13% have missed their own work Christmas party
  • 49% have worked on Christmas Day
  • 18% have actually gone into work on Christmas Day

To make sure trading can continue at the intended pace, it is important to be aware of any supplier plans, and possibly stock up in advance.

Delivery companies will be especially busy, but it is crucial to ensure customer expectations are met for those sending products via post. Liaise with delivery companies and inform customers of the latest date that orders must be made in order to receive goods in time for Christmas.

SMEs should also make sure that advance warning is given of any office closures or reduced openings. As they say, it takes 20 years to build a reputation and five minutes to ruin it and managing customer expectations is vital to avoid potential issues.

Making information prominent on a business website and sending a customer email are both recommended.

Protecting business premises

Winter weather can bring added risks for properties including escape of water from frozen pipes. If there is a limited staff presence over Christmas and New Year, problems can go undetected and cause additional damage.

Businesses should take appropriate action, such as draining outside taps and keeping central heating at an ambient temperature, to avoid incidents. If any staff are working at the business premises over the festive period, SMEs should make sure they are aware of what to do if a leak occurs, such as the location of the property’s stop cock to shut off the water.

It seems current economic and political concerns are driving many of our small business owners to carry on working.”

Jason Eatock, Head of SME at Zurich

Businesses should also be aware of the heightened risk of theft. Thieves will know that many businesses close over Christmas, giving them ample opportunity to break in. Security systems should be tested, and it may be beneficial to put some lights on timers to simulate the presence of workers.

How we can help

“As we look forward to taking some rest over the Christmas season, it seems current economic and political concerns are driving many of our small business owners to carry on working,” says Jason Eatock, Head of SME at Zurich.

“We hope that everyone gets a chance to enjoy the holidays, and as ever we offer our support to make their businesses run as smoothly as possible during the festive season.”

For more information about how you can help your customers manage any additional risks over Christmas, giving them the peace of mind to take a much-deserved break, please contact your local Zurich Account Executive.

Image © Alamy

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