From harvesting to construction to hospitality, managing a business in a seasonal industry is no easy task. When both access to your supplies and demand for your products depend on trends that vary throughout the year, you have to plan carefully to maintain consistent profits. The following tips will help you do just that, setting the stage for enduring success:
1. Be Precise About Seasonal Planning.
The first and most important tip for seasonal business management is to come up with precise estimates for any changes throughout the year that affect your operation. Only once you know exactly when you will have access to supplies and customers will you be able to make concrete plans. If you’ve already been in business for a few years, look at past sales records and supply receipts. If you haven’t, check the statistics for your industry. Try to figure out not only when the off and on seasons are, but also how quickly you can expect to transition from one to the other. If customers suddenly stop coming in after a certain date, you’ll have to make different plans than if demand slowly dwindles over the course of weeks or months.
2. Use The Offseason To Plan For The On Season.
Once you know exactly when demand will rise and fall, you can start using the times of low demand to get ready for high demand. How you do this will depend on your specific industry and customer base. If you run a hotel or a restaurant, you can stock up on any supplies that will keep for extended periods; you’ll likely be able to get a better price for them now than if you waited for the on season. Likewise, if you’re in the construction industry, you can study building trends in your area, determine your likely labor and equipment needs, and begin gathering these resources.
3. Limit Your Costs & Shore Up Your Funding.
Both revenues and costs fall during the offseason, but revenues tend to fall faster and farther. This can put serious financial pressure on your company, particularly if it’s a small startup with little in the way of savings or assets. To minimize the risk to your company, start by looking for ways to lower costs as much as possible. If you have facilities that you don’t need to use, you can rent them to other businesses; the same goes for trucks and certain types of machinery. But even after all this, you may still have a shortfall, so look for a lender who provides working capital to seasonal companies.
4. Expand Your Marketing Efforts.
While customers are unlikely to actually buy your products or services during the offseason, that doesn’t mean you can’t plant the seeds of later sales. Marketing campaigns can get people interested in your products and give them an incentive to buy them later. This is particularly true if you sell both products and services for which those products are necessary. Say that you run a ski resort that also sells skis and snowboards to visitors. If you offer potential customers a discount on that equipment during the summer, you can convince more of them to buy it. But then they’ll have to visit your resort in the winter in order to use them.
5. Help Your Staff Weather The Shift.
Seasonal fluctuations often have the biggest impact on members of your staff. Even if they make enough money during the on season to stay afloat financially in the off, they don’t want to spend 3 or 4 months with nothing to do. If you can help them find jobs in the offseason, this will improve their morale, making them happier to work for you and more likely to stay loyal for the long haul.
Managing a seasonal business is always a challenge, but through careful planning and preparation, you’ll be more than prepared to meet it. For more information on success for all seasons, contact us today.