7 Tips for Year-Round Profitability for Seasonal Businesses
A seasonal business doesn’t have to mean part-time profits.
- Running a seasonal business doesn’t have to mean any off-season cash flow.
- Managing your cash flow and expanding sales during slow periods is crucial.
- The offseason is also an excellent time to plan, strategize and build customer relationships.
- This article is for seasonal business owners who want to keep their businesses afloat comfortably throughout the year.
Being a business owner is stressful, and it may become much more demanding if your company is only successful for a portion of the year. Running a seasonal business, however, does not guarantee that you will have no cash flow during the offseason. Your company can continue to be profitable long after the peak season has passed with proper planning and the appropriate strategy.
Here’s how to keep your business viable all year long, whether you’re preparing for the holiday season or slowing down after your summertime surge.
1. Understand and manage offseason expenses.
Understanding and controlling your cash flow and expenses is something any business owner must do, but it’s crucial for seasonal enterprises. Consider strategies to reduce or eliminate business expenses if you have an understanding of your offseason costs.
Each dollar that you withdraw from your bank account is money that you can use to prepare for the offseason. Make it a priority to cut back on necessary spending and get rid of extra expenses.
It would be beneficial if you also looked into techniques to increase your sales during off-peak times. To assist with spending over the offseason, you ought to offer monthly payment arrangements. Offering monthly payment plans can be a terrific method to make your services more affordable for a customer while also giving your company a steady flow of income all year long.
Advertise seasonal services and offers incentives for individuals to sign up off-season.
The best thing to do to help with this is to create a budget and follow it for the full year.
2. Use of the offseason to strategize and plan.
Even if it’s the offseason, you can still complete responsibilities and advance your company. Take advantage of the downtime to plan, strategize, and train your staff.
The off-season is a fantastic time to evaluate what went well and what did not. This is the exercise we refer to as “start, stop, or continue.” What should we start doing differently in light of how well we performed last season? What ought to stop being done? What should we do going forward?
Christmas Decor’s president, Brandon Stephens, also uses the off-season to consider the needs of the company and establish objectives and profit targets for the upcoming season. This could entail determining the optimal client retention rate, altering the training procedure, acquiring new equipment, performing pricing analyses, updating marketing materials, etc.
3. Look for other business opportunities and diversify services.
Finding another business to counterbalance the busy season is the greatest way to be profitable all year long.
When you make a list of potential projects, you should pick those that you can carry out with the same staff and resources as your main firm. This will lower your overhead expenses and make it simpler for you to introduce your new company to your existing clientele.
Stephen looks for services that use comparable tools and supplies. His Christmas décor company, for instance, serves different holiday seasons as well as other holidays and special occasions like weddings.
To better serve our clients, we also seek out companies who have complementary offseasons and expand upon what we now offer.
“If I have an employee that can execute a variety of activities for all seasons, that individual creates greater value for the company and can be shifted when the need arises”. Diversifying the services of a seasonal business helps create annual consistency.
4. Seek out opportunities with businesses that have longer seasons.
At the end of your peak season, Toffer Grant, founder and CEO of prepaid business Visa supplier PEX Card, advises going over your inventory to see if there is anything you can sell off.
He remarked, “A firm has to decide [whether] it is worthwhile to have money tied up in equipment and supplies that hang around until the next season.” Sell materials for what was paid for or even at a slight loss in order to cash out those products in order to recoup some of the money.
Fouts said his objective is to get the inventory as close to zero as possible before the end of the season. “We’ll run a special on whatever color or type of lights we have in excess, sell off inventory to franchisees in the network or other companies. If, at the end of the season, there is still an excess of a certain color or type of lights, we’ll store them during the offseason.”
5. Try to expand to other locations.
In your current location, your business may be off-season, yet there might be a demand elsewhere. There may be huge demand in other regions of the world as well; these chances aren’t just available in the United States.
For instance, if your company sells goods that are popular in the spring and summer, you can experience a decline in business throughout the fall and winter months. But once December arrives, summer only just starts in places like Australia and New Zealand. To sell your goods in those nations may be a sizable potential.
6. Take advantage of off-season sales.
At the end of the season, excess goods don’t have to languish in a warehouse for the next six months. You may give this inventory to your clients at a significant discount in addition to selling part of it to other companies.
For instance, if you sell goods with a Christmas theme, you can keep charging less for these goods. After the holidays, many buyers specifically try to take advantage of steep reductions.
Although you might not maintain the same level of sales as you do during the busy season, this is a terrific method to generate some extra money all year long.
7. Keep in touch with your customers.
Even when the peak season is passed, your client relationship still exists. To keep your consumers, it’s crucial to communicate often throughout the year and to keep fostering that relationship.
Being proactive will help you retain customers. Continue writing blog pieces and uploading frequently on social media. Continue to email your clients on a weekly basis so they get used to hearing from you. Consider using an email marketing provider to automate the process, produce emails with a polished appearance, and maintain your contact lists.
Other email marketing techniques that help keep you in front of your clients include using customer segmentation to customize your messages by audience and including a call to action to boost interaction.
Maintaining your relationship with your clients has many advantages. It first positions your company as a thought leader in your sector. People will naturally think of your company when they consider your industry, and they’ll be more likely to recommend you to friends and family.
Additionally, maintaining contact with your consumers all year long can make the following busy season for your company more prosperous. For instance, if your company has a Christmas theme, you can start generating interest in the forthcoming season as early as September or October.
Pingback: 7 Tips for Year-Round Profitability for Seasonal Businesses – Tunnelex