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Christmas Party Time?

Is your business lucky enough to be throwing a Christmas party this year? Unfortunately, in the North West, nearly a third of small firms have no budget to throw a party for their hard working staff at the end of the year. Following problems with late payment and the associated cash flow issues, coupled with a tough sales environment, it’s becoming harder for many to afford the traditional Christmas festivities.

According to the latest Close Brothers Business Barometer, around 30% of respondents in the North West were planning on axeing their Christmas party in order to cut down on costs. While staff might often expect some sort of Christmas do, it’s seen as one of those optional extras that can be shed when times are tough. With small business financing in such a state, its no wonder that the Christmas party is becoming less common in the region.

A further 22% of North West businesses said they would go ahead with their party, but on a smaller scale. This will allow them to get the best of both worlds, boosting staff morale but also avoiding any huge expenditures. However, of those that are going ahead with their party, almost half stated that the staff would need to contribute to the cost – not what staff will want at Christmas!

This shows that many businesses are still in austerity mode, cutting back on non-essentials in order to keep their heads above water going into the new year. While staff missing out on their Christmas party is a shame, it’s indicative of wider problems in the SME sector – businesses simply don’t have cash to splash on non-essentials, and many are still in belt tightening mode.

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