Managing your craft brewery’s cash flow amid economic uncertainty

Ways to improve cash flow management

Forecasting and trends

Especially during economic uncertainty, using valuable data to assess how the market is doing, where it’s going, and how your brewery fits into that, will enable you to better approach decision making.

Accurate financial forecasting is crucial to allowing you to predict future cash flow based on sales trends, production costs, and market conditions.

Knowing your brewery’s trends can also go a long way to effectively managing cash flow. Make sure you have what you need heading into slow times or seasons and be prepared to ramp up quickly when business picks back up. Is your profitability consistent or is there frequent change? If you have plans for an expansion or other big project, do you have sufficient cash flow to allow for that?

Supply chain management

Optimize your supply chain for efficiency by collaborating with suppliers for cost-effective and appropriately timed inventory management to prevent overproduction and excess inventory.

Especially during times of economic turbulence, have a plan in place for potential supply chain disruptions that could impact production. Having backup suppliers or alternative sourcing strategies can help maintain operations and cash flow during challenging situations.

Pricing and margin flexibility

Depending on demand and competition, you’ll need to be willing to adapt pricing to maintain healthy and sustainable profit margins.

Closely monitoring market conditions will help you understand how extenuating circumstances can affect customer behaviour, preferences, and demand.

By consistently evaluating your cost structure you can identify areas where cost savings can be achieved without compromising the quality of your product.

Marketing and operational analytics

Understanding market trends are invaluable in helping you see how consumer needs and demands are changing and put you in a position to capitalize on that information.

Whether it means adding or removing a certain product from your offerings, advertising or operating in a certain geographic location, or marketing in a specific way to bring in more customers, using data to adjust your systems and processes regularly is key.

Ultimately, prioritizing financial planning and flexibility starts with a deep understanding of your business. Navigating the market and the challenges within it has never been a more demanding task for craft brewers but planning for the unpredictable goes a long way.

Managing cash flow will look different for every craft brewery but with the help of an experienced MNP advisor, you can gain peace of mind knowing that you’re working to future-proof your business.