For some companies, it’s only possible to run at certain times of year. For example, Christmas tree shops will only ever be busy in December, whereas surf schools will be busy over the summer, especially during school holidays – but who wants to splash about in the sea in the middle of February? As a seasonal business owner there are some challenges you’ll have to face but with careful planning, you should be able to overcome such obstacles.
Cashflow management is essential to anyone trying to run a successful seasonal business. You’ll need to budget very carefully to ensure that your expenses are covered during peak times and quiet times. Cashflow forecasting will be an essential tool, so ensure that you understand how it works – if in doubt seek help.
If you make any profits above what you forecast then that’s great, but try to save at least some of your extra profit to ensure that you’re covered in the off-season, just in case your quiet times are quieter than expected.
Additionally, try to cut costs as much as possible during quiet times. You could ensure that your staffing levels remain minimal. If you deal with suppliers, try getting some quotes from their competitors to ensure you’re getting the best deal. You could also try negotiating with your landlord to see if there’s any way of decreasing your rent in off-peak periods. You could also check that you’re not overpaying on yourinsurance policies – again, call around to seek the best deal.
Many seasonal business owners focus on another business area in their quiet periods. For example, a manufacturer who produces umbrellas would mainly sell their product in the autumn and winter, so they could consider manufacturing parasols during the spring and summer to cover any shortfalls.
If you’re unable to do so, then you can use off-season times to plan for the upcoming season. Check and update your budgets, marketing and sales plans and your overall business plan. Most of these documents become obsolete quite quickly, especially if you work in a sector that changes rapidly.
Another option is expanding into another country, if your business relies heavily on either summer or winter – remember that when it’s summer in the northern hemisphere, it’s winter in the southern hemisphere and vice versa. One of our guides to international business may be able to help with this, and although it may be a complicated process depending on your business, you may be able to ensure you have a steady cashflow year-round.
If you’re only busy according to the time of year, you should have a good idea of how many staff you will need to cover busy periods. If you only require staff for two or three months of the year, ensure that you only ever take on temporary staff, or staff on fixed-term contracts. If you are unsure of how busy you will be you may wish to use a recruitment agency to take on temporary staff, as they will be able to find suitable staff on short notice – see our guide for more details.
As mentioned, you should use your quiet periods to update your marketing and sales plans. As your peak season approaches, ensure that you are marketing your business at least a month in advance, preferably more. Once you become busier, keep up your marketing activities.
You should also ensure that your marketing remains active during quieter periods – but don’t spend huge amounts of money when you know you won’t make a return on it. Instead, you could ensure that you continue to interact with your audience via social media or a blog as these are particularly cost-effective forms of marketing.