The summer operations checklist: 7 cash flow decisions to make before Memorial Day
The summer operations checklist: 7 cash flow decisions to make before Memorial Day
Memorial Day doesn’t just mark the unofficial start of summer. For B2B businesses, the holiday marks the start of a season that can punish those who are unprepared. Factors such as decision-makers going on vacation, payment cycles naturally slowing down, and staffing needs shifting can all play a role. The companies that survive these times aren’t lucky. They’re ready.
To help your business prepare, Gateway Commercial Finance, an invoice factoring company, has put together a list of seven cash flow decisions derived from data from sources including the U.S. Chamber of Commerce, National Association of Credit Management, Resolve Pay, Wells Fargo Small Business, Capital One, and more.
The pre-summer B2B cash flow checklist
The key linking the seven checklist items is the fact that they must be implemented before the calendar flips to Memorial Day. They are designed to be preemptive tips, not reactive ones, so don’t wait before integrating.
1. Run a full cash flow forecast through Q3
The first tip your business should implement is to map your cash position on a week-by-week basis through the third quarter of the year. The U.S. Chamber of Commerce outlines cash flow forecasting as foundational to sound capital decisions, so it’s recommended to build three scenarios:
- A best-case or upside scenario.
- A base-case or business-as-usual scenario.
- A stress- or worst-case scenario.
When building out these models, you should also adjust customer payment times to see what would occur if a major player pays 30 days late. When considering the true test in summer, your stress-case forecast should be it.
2. Review and tighten credit terms with major customers
Late payments are already a problem with B2B businesses before summer inevitably makes them worse. According to the 2025 Payment Practices Barometer for North America study run by Atradius, a global provider of trade credit insurance, 43% of credit-based B2B sales in the U.S. are overdue. Additionally, bad debts are now estimated to affect 5% of long-outstanding invoices.
To avoid being impacted, review which of your customers are consistently late ahead of Memorial Day and consider shortening terms. Required deposits on large orders or incentives for early payment can also accelerate receivables ahead of the summer slowdown.
3. Pre-negotiate seasonal payment arrangements with key clients
Summer vacations don’t just affect your team, but also your clients payables departments. If they have decision-makers out, approvals can be delayed or invoices aged past their due date may remain untouched with no one watching them. A good rule of thumb is to reach out to your most important clients ahead of the summer months. Confirm payment schedules with them, identify backup payables contacts, and get any modified arrangements in writing.
4. Accelerate any outstanding accounts receivable
If you have any invoice already outstanding to your business, it should be collected before summer. Not doing so can compound the delay. For other invoices, run a full aging report on your accounts receivable and escalate anything approaching the 60-to-90-day window.
Consider offering a one-time early payment incentive, also a key optimization tool outlined by the U.S. Chamber of Commerce, if you have any hesitant customers. This can cut the lag between delivery and payment. It can also ensure you’re entering summer with your receivables current.
5. Renegotiate vendor and supplier payment terms
While collecting faster on inflows, simultaneously push cash outflows further out. Phoenix Strategy Group, a private equity investor and advisor, notes that simply extending supplier payment terms from Net 30 to Net 60 can quickly improve working capital without taking on debt. Try to approach the vendors you have the highest spend with first and lead with your payment history as leverage. Making this ask before summer cash pressures arrive is best. This is when your negotiating position is strongest.
6. Adjust your staffing budget for summer conditions
Summer staffing issues cut both ways. If you think there will be a demand surge during the summer months, secure temporary staffing agreements before Memorial Day. You’ll have access to a larger talent pool and avoid last-minute premium price hikes. Conversely, if you expect a slowdown in business, plan for reduced-hour or headcount adjustments now.
7. Secure or activate your business line of credit
Lenders evaluate your creditworthiness based on current financial health. It isn’t based on future needs. Applying for a line of credit, as an example, during a cash crunch means weaker financials, slower approvals, and worse credit terms. Wells Fargo Small Business and Capital One both advise keeping enough cash to cover your expenses for a three-to-six-month period along with enough to fund new business growth to show the best financial picture.
This will allow you to utilize only what you need, pay interest only on what you use, and repay right as receivables come in, as opposed to using debt to make up for a cash shortage.
Preparing your business for summer
The businesses that struggle most in the summer are those that treated Memorial Day approaching as just a holiday on the calendar rather than a deadline. Work through the seven-step checklist in the months and weeks before May 25 to ensure you are entering the season with tighter receivables, more favorably payment terms, and secured access to credit. In a season where your competitors might be out scrambling, being prepared can be a genuine advantage.
This story was produced by Gateway Commercial Finance and reviewed and distributed by Stacker.
