As we enter the holiday season, many Christmas-themed businesses start running again. However, it’s no secret that these seasonal businesses have it more difficult than regular ones. Sure, you can earn a considerable profit and revenue during the season but you have to manage your business during the off-season as well. That may prove to be challenging, especially since there are no sales during the “dry period.”
During this period, your cash flow starts to decrease but there are still expenses to cover. In other words, the off-season period can be a financial burden for normal businesses with seasonal swings, let alone for seasonal businesses.
In addition, you must ensure that your business is profitable enough during the season in order to ensure long-term success and a competitive edge on the market. However, just because managing a seasonal business is difficult during the off-season, it doesn’t mean that’s impossible. The key is in careful planning that will help you succeed in the future. With that in mind, here are a few tips that will help you with your seasonal business.
Develop a business plan
Every business needs a business plan, including seasonal businesses. Without a plan, you may easily end up in major difficulties that could have been easily avoided if you just planned things out. Seasonal businesses oftentimes face dynamic outcomes. People who are looking to shop during the holiday promotions will look for the best offers they can find.
That’s why it’s important to conduct a bit of forecasting and develop a plan based on your research. As an example, what are the current market trends your customers are following? This will help you determine their behaviour for the upcoming season and give you insight into encouraging them to buy from you.
Improve your marketing efforts
Marketing is a staple of success for your seasonal business. You need to develop an actionable holiday marketing strategy as soon as possible, and that requires creating a campaign checklist, figuring out which are the key metrics you’re gonna track, develop a content strategy, social media campaign, and come up with tempting offers and promotions.
Craft compelling offers and gain the audience’s attention even before the season starts is one of the most important things you need to do. For example, you need to develop pre-seasonal, seasonal and post-season promotions. Pre-season promotion is to generate enough buzz for your products, seasonal promotion is to encourage people to buy and post-season promotions are to sell out what’s left of your inventory through compelling discounts. That way, you can ensure good profitability that will sustain your business until the next season.
Take care of your cash flow issues
As mentioned before, your cash flow will decrease and perhaps even go into a negative during the off-season. It’s very important to maintain positive cash flow during those times, in order to avoid unnecessary debt and cover all the necessary expenses such as bills, taxes, utilities, etc.
As an example, you can set your invoice payments to generate profits even during the off-season. You can set invoice due dates to be anywhere between 30 and 120 days. That way, profits will be coming in even after the season has passed.
It’s no secret that you’ll need employees to help you out during the peak season sales. However, the trouble is that you won’t need employees throughout the entire years, which means full-time employment doesn’t really suit you with your seasonal business. Fortunately, there are a lot of people who are more than willing to accept part-time seasonal employment.
However, if you hire smart, you won’t have to look for new employees every year. If you establish a good relationship with your seasonal employees, you can rely on the fact that they’ll work for you again the next year. That’s why you should hire smart, such as opt for students or people looking for an additional job during the season.
Save for rainy days
At the end of the day, your business survival in the off-season depends on your financial health as well as on your management skills. In most cases, finances are a real issue that determines the seasonal business success. If you want to ensure that your business will remain afloat until the next season, you should save as much as you can in your emergency savings account.
You can use this money to improve your cash flow, restock your inventory, fix broken equipment or invest in a business opportunity should the need arise. You don’t have to use it unless you really need it and having money on the side is always helpful, especially if you find yourself in an unexpected and difficult financial situation.
Running a successful seasonal business isn’t easy. You have to make an effort to ensure profitability during the season, as well as make an extra effort to maintain your business when it’s not profitable at all. This requires a lot of dedication. However, with a bit of good planning and budgeting, you can ensure that your seasonal business will be successful.