One of the most important skills a business owner can have is knowing when business is going to slow down. For some, it may happen during the summer when customers are on vacation and out of their routine. For others, it could be the winter when buyers’ own businesses have slowed, necessitating less product.
No matter when it happens, the challenge remains the same. Revenue may drop, but expenses will remain fairly constant. Payroll is typically fixed, suppliers expect payment, not to mention recurring costs like rent, utilities, insurance, loans, etc.
Slow seasons are bound to happen, but lack of preparation can sink a venture that doesn’t have a plan in place to weather them. Getting ahead of it is the key, preparing rather than reacting. Having a plan in place early gives you more options and greater flexibility when the dip comes, so it’s best to approach these four steps sooner rather than later.
Start With a Weekly Cash Forecast
According to Shana Peterson-Sheptak, Executive Vice President and Head Small Business Lending Sales at PNC Bank, effective cash management begins with visibility, and this means forecasting revenue and expenses.
This shouldn’t be one week at a time, but at least six to eight weeks ahead, giving a realistic picture of the inflows and outflows that are expected.
"It's important to understand what payments you expect to receive, what inventory you have to purchase, and then think about your payroll, rent, and any fixed expenses," Peterson-Sheptak says.
Complete accuracy isn’t the point here but rather identifying gaps before they become serious problems. Manufacturers routinely forecast production schedules, labor needs, and inventory requirements. Cash flow deserves the same level of attention. A company that identifies a potential shortfall weeks in advance has time to adjust purchasing plans, strengthen collection efforts, or evaluate financing options.
Strengthen Working Capital by Accelerating Receivables
After determining one’s financial situation, it’s now time to improve the speed at which cash moves through the business.
During slower periods, Peterson-Sheptak recommends asking a simple question: "How do you accelerate receivables?"
For many businesses, the answer lies in refining existing processes. Improve the speed at which invoices are sent, review reports regularly, follow up on outstanding invoices, and even consider utilizing some sort of incentive to ensure invoices are paid quicker.
Time is money, and even improving payment speeds by a week may have a substantial impact on the bottom line when applied throughout the business.
As Peterson-Sheptak explains, one of the core principles of working-capital management is to "collect your revenue quicker and then stretch out payment to your suppliers to keep more cash on hand."
That doesn't mean delaying payments indiscriminately or damaging supplier relationships. Instead, it means negotiating payment terms, delivery schedules, and purchasing strategies that support both operational needs and financial stability. Extending payment terms, staggering deliveries, or timing large purchases around stronger cash-flow periods may help preserve liquidity while keeping production on track.
Review Expenses Before Revenue Slows
When business declines, most owners immediately focus on increasing sales, but cutting costs is just as important when income drops.
It’s important to review discretionary spending before cash flow slows. Peterson-Sheptak prompts, "Are there expenses that you can manage more tightly? Not cost cutting, per-se, but preserving flexibility where possible."
Delaying a noncritical purchase or investment for several months may help maintain stronger cash reserves without significantly disrupting operations. This is why forecasting is critical, because midway through a renovation or upgrade isn’t the time to realize you’re low on cash.
Secure Liquidity Before You Need It
Too often, businesses begin looking for financing only after cash balances start to shrink. By that point, options may be more limited, and decisions are often made under pressure.
"This is where securing liquidity or securing a line of credit in advance can help you through your slower season," Peterson-Sheptak says.
Planning ahead allows businesses to focus on operations rather than scrambling for capital when cash becomes tight, and technology can support those efforts as well.
Treasury management tools that provide real-time visibility into account balances, cash positions, and payment activity can help manufacturers make more informed decisions. Automated Clearing House (ACH) and Same Day ACH services can help businesses manage the timing of payments and collections, while platforms such as PNC's PINACLE® Cash Management platform can provide greater visibility into liquidity and support forecasting efforts.
Prepare Before the Slow Season Arrives
Every manufacturer experiences periods when business conditions change. Whether the slowdown comes during the summer, around the holidays, or at another predictable point in the cycle, the businesses that navigate those periods most effectively tend to follow the same approach: they forecast cash regularly, manage working capital proactively, review expenses carefully, and secure liquidity before it becomes a necessity.
Peterson-Sheptak believes the key is preparing before challenges emerge, not after.
Manufacturers spend significant time planning production schedules, staffing levels, and inventory requirements. Applying that same discipline to cash flow may help transform seasonal uncertainty into a manageable business challenge.
Slow seasons may be inevitable, but cash-flow surprises don't have to be. The manufacturers that plan ahead are often the ones best positioned to weather changing business conditions with confidence, flexibility, and resilience.
