Invoice before you switch off: getting cash in before the break

Picture the second week of January. The phone is quiet, the work is only just starting back up, and the bank balance is lower than you'd like. Then the bills arrive: GST and provisional tax on 15 January, PAYE on the 20th, and suppliers wanting their December accounts paid.

The cash that carries you through that stretch mostly comes from one place: what you invoiced, and what you got paid, before you switched off in December.

That makes the first few weeks of December some of the most valuable in your year. Here's how to use them well.

Why December invoicing matters more than usual

Most NZ businesses slow down between mid-December and late January. Your customers do too. Their accounts teams take leave, approvals sit in inboxes, and payment runs get skipped.

So an invoice sent on 22 December often isn't paid until late January, sometimes February. An invoice sent on 1 December, to a customer who pays on the 20th of the following month, lands before the break. Same work, same amount, very different month for your cashflow.

The public holidays don't help. This summer, Christmas Day falls on a Friday, Boxing Day is observed on Monday 28 December, and the New Year holidays run through to Monday 4 January. Banks don't process payments on those days, so even a customer who pays promptly may not have the money in your account until the following week.

Clear the decks: a pre-break invoicing checklist

Set aside an hour in late November or the first week of December and work through this list.

1. Invoice everything that's finished. Look for completed jobs that haven't been billed yet. Small jobs are the usual culprits, especially the ones done on the side of something bigger.

2. Bill work in progress where you can. If a project runs over the break, invoice the stage that's done now. If your terms allow progress claims or deposits, use them. We covered how to set these up in payment terms that actually work.

3. Check for drafts. It's surprisingly common to find invoices sitting in draft, finished but never approved and sent. Clear them out.

4. Bring the invoice date forward. If you usually invoice at the end of the month, consider invoicing at the start of December instead. Many customers run their last payment batch of the year in mid-December, and you want to be in it.

5. Check your customers' payment cut-offs. Larger customers often have a last date for invoices to be received before the break. A quick email asking "When's your last payment run before Christmas?" can save you a month's wait.

Chase what's already overdue

New invoices are only half the picture. Anything already overdue needs attention now, while your customers are still at their desks.

Run your aged receivables report (there's a quick way to do this in Xero below) and work from the oldest balances down. A friendly call or email in early December is far more effective than one sent on 23 December, when everyone is trying to leave.

If you've set up automated reminders, check they're switched on and that the wording still suits. If you haven't, it's worth doing before the break so they keep working while you're away. Our guide to automating reminders and direct debit in Xero walks through it.

For accounts that have gone quiet, a calm, staged approach works better than a stern one. This is the process we recommend.

Make it easy to pay you

The fewer steps between your invoice and your bank account, the faster the money arrives.

• Make sure your bank account details are on every invoice, and are correct.
• Add a "Pay now" option so customers can pay by card or direct debit straight from the invoice.
• Use a clear due date, not "net 30" or "on receipt", so there's no room for interpretation.
• Send invoices to the right person. A quick check that you have the customer's accounts email address, not just your usual contact, can save weeks.

Plan for what you'll owe in January

Getting cash in is one side of it. Knowing what's going out is the other.

Before you close, write down what's due in January: GST and provisional tax on 15 January for most businesses, PAYE on the 20th, plus rent, subscriptions and supplier accounts. Compare that with what you expect to have in the bank and what you expect customers to pay over the break.

If there's a gap, you want to know now, not on 14 January. It might mean chasing harder, delaying a purchase, or talking to us about options. Our summer slowdown cashflow guide covers how to forecast the dip.

A December to-do that pays for your January

None of this is complicated. It's mostly about doing the usual things a few weeks earlier than usual, and making sure nothing finished is sitting unbilled when you lock the door.

An hour spent on your invoicing now can make the difference between a January you enjoy and one you spend worrying about cash.

If you'd like a hand reviewing what's outstanding before the break, or want us to take invoicing and debtor follow-up off your plate altogether, get in touch. We'd love to help.