The biggest shopping event of the year is almost upon us: Black Friday. On 25 November, discerning-deal hunters up and down the land will embark on a shopping bonanza – online and in-store. Initially started in the US to kick off the Christmas shopping season after Thanksgiving, Black Friday has evolved into a global phenomenon.  

With millions of deals to be had across everything from tech to teapots, and almost every brand participating, this is the time to bag a bargain. In the UK alone, consumers spent a total of £9.42 billion during the 2021 Black Friday weekend, with online purchases accounting for 61.49% of sales. 

But what’s it like on the other side of the till and the online checkout screen? On the face of it, this sales jackpot appears a major boon for any business – especially a small one. In the UK, small business retailers enjoy average sales growth of 40% during this period. However, this sudden surge in footfall and online activity exposes these businesses to several challenges that can leave them ruing rather than relishing Black Friday, including: 

• Increase in returns that can’t be resold before Christmas. If a small business experiences a spike in returns, it can take a huge toll on cash flow. 
• Running out of inventory during this critical period can restrict profits and damage reputation. If this occurs before payments have cleared, small businesses might lack the capital to replenish it. They might also lack the up-front capital to purchase excess inventory in the first place.  
• Rising overheads are a consequence of rising sales. Costs, such as energy, distribution, packaging, and logistics typically rise during the Black Friday period and often need to be paid before profits are recouped.  
• Understaffing can leave small businesses hamstrung when attempting to manage this temporary spike in orders. Consequently, many are forced to take on temporary staff during this peak period or pay existing staff to work overtime. To fund this increased overhead, they require instant access to working capital. 

Financial stability is crucial during this bumper sales period. To overcome the inherent hurdles, resilient small businesses shield themselves from the financial demands of Black Friday by leveraging   revenue-based finance: an alternative form of finance that allows small businesses to access funding based solely on their overall business revenue – and the benefits are compelling: 

• The application process is primarily conducted online with a few clicks, and a decision is made within a matter of minutes. 
• Don’t need to provide personal guarantees or assets to access vital funds.  
• Don’t need to meet set repayment dates each month. 
• Funding is authorised based on the overall financial performance of the business. 
• Repayment is made with confidence, with the business generating the revenue needed from each customer transaction. 

By partnering with acquirers like Elavon, Worldpay and Barclaycard, a merchant bank like Tide or harnessing an eCommerce platform like Klarna, small businesses can access bespoke, pre-approved funding when they need it most. With approval and repayment based on overall revenue – rather than financial statements and fixed interest rates – and funding typically secured within 48 hours, they can ensure Black Friday is a profitable, not a problematic, period.