Fashion Professional: Top tips for maintaining a healthy balance sheet

Published, 3 years ago

Great news, you’ve secured the fashion line order, you’ve got customers booking you up for the next six months, and things are looking rather grand on building the business and brand front.  But, we mustn’t get carried away.  We can’t.  Things change too fast, especially in the creative industry.

Our recent post on Famous Fashion Brands is a testament to how fast things can happen and circumstances change in an instant. No matter how many orders you have coming in, managing your finances is a full-time position.

In this post, we’re going to look at some of the ways creative businesses can keep a steady cash flow forecast in a turbulent market.

Tips for maintaining a healthy cash flow

  1. Keep it simple – it may sound obvious, but it’s important to keep an eye on your accounts. Knowing where every penny is going and exactly what is coming into your business helps you stay on top of things and stop things going awry.

 Of course, we know you want to do the thing that excites you most, which in our industry is much more creative than accounting, but we can’t stress enough how important this is.  Remember the “fail to plan and plan to fail” motto?  Stick to it and keep it as your mantra.

  1. Don’t let late payment pull you down. If you’re worried about late payments, look to offer incentives for early payments.  Or if you’re experiencing late payment problems with certain suppliers or customers, look to put strong terms and conditions in place to secure debts faster and consider charging late payment penalties where necessary.

 It’s also important to do your research into who you’re working with and to take on board that the fashion industry is known for its unusually long cash-flow cycle.  Moving from design to factory, contracting, production, logistics, and sales – all take financing, and you need to have the cash flow reserves in place to be able to manage this cycle.

Consider options such as factoring, or invoice discounting to help maintain your cash flow while you wait for payment.

  1. If you’re looking to grow your business, you need to consider your funding options.

For those within the fashion industry, one of the main streams of funding comes through investment.  Investment into the brand, into your fashion line, while at the same time taking a share or a percentage return in the business.

It’s about finding the right investor for you and your business.  Think about what skills they can offer and bring (other than just cash).  What are you looking for and how can it help your business grow?  Think long term.

  1. One of the worst mistakes we can make in business is burying our heads in the sand and ploughing on. Not asking for advice or help from our peers and/or professionals in the financial industry is not going to help you or your business, don’t struggle on in silence. Speaking to someone who has been in through what you’re experiencing or has knowledge of the options available to get you over a hurdle is essential to keeping you moving forward.


Maintaining a strong financial foothold in the industry, as well as looking to grow your business isn’t easy, but when we look at the famous fashion brands that are around today, we know it can be done.

Start thinking about getting invoices out on time, every time. Make sure you have good, if not the best, payment terms with your suppliers and that you also look at software and possibly even accountancy packages to help you manage your cash flow and provide that bird’s eye view you need.

Cash flow cycles aren’t easy, but they are manageable and can be positively maintained and grown if you have the right forward-thinking in place.

Liked what you read? Share the article!

Share on facebook
Share on twitter
Share on pocket
Share on whatsapp
Share on linkedin

Get Noticed with Fashion Rider.

Get the recognition you deserve. Portfolio, Jobs, Social Media promotion and much more. All in one membership. 

You might also like

Fashion and the end of the Brexit transition period

19th October 2020 Fashion and the end of the Brexit transition period – points to consider as we approach 31 December 2020 With less than …

Read More

How Freelancers Can Thrive With a Strong Digital Presence

Freelancer? Working from home or for yourself? In need of a gentle reminder? Whatever your business and whatever your industry; a strong digital presence has …

Read More

How To Grow Your Social Media

In most industries social media is used on a daily basis, particularly in the fashion industry. Making your posts gain traction and high quality leads …

Read More

Things to consider in a Fashion Marketing Strategy

Having a marketing strategy that is consistent and is relevant to your customer base is so important when trying to grow a business. You need …

Read More

Fashion Advice: Funding for Fashion Professionals

Launching a business can be a scary yet exciting time.  You have your business plan and strategy set, and you have a clear vision as …

Read More

Fashion Industry Awareness

Whether you are just starting or have been working in the fashion industry for a while, you already know that watching out for the latest …

Read More

Top 8 Fashion Tips for Working Women Who Want To Break That Glass Ceiling

As a woman trying to make it in the cutthroat competitive working environment that is the corporate world, you have your work cut out for …

Read More

Fashion Professionals: Do you know your taxes?

Running your own business, big or small, involves taking care of your tax returns.  Knowing your taxes and in particular small business taxes are vital. …

Read More

Fashion Professionals: Are you using the right accounting software for your business?

Accounting and indeed accounting software can be a minefield if you’re not doing it day in and day out. Accounting isn’t always everyone’s strong point …

Read More

We use cookies to offer you a better experience and analyze site traffic. By continuing, you consent to the use of the cookies following our privacy policy. You may choose to opt-out through our privacy policy page.