6 Ways to Survive Business Seasonality without Going Broke

Although we usually tend to associate seasonal spikes and off-season times with tourism and seasonal business, in some cases, companies can operate without any revenue for months in a row, we can hardly narrow this problem to one specific industry.

For instance, some of the biggest companies in the world like Amazon, make 30% or more of their annual profits during the winter holiday season. So, the problem of seasonal slowdowns is real, present and it hits all industries without prejudice.

With that in mind, let us see what we can do to overcome this obstacle and survive business seasonality without going broke.

Diversify the product portfolio

No matter what we do, we can’t change the fact that holiday and vacation seasons are the periods when people spend most and where, depending on the industry in question, a large portion of your revenue will come from. What you can do, however, to mitigate this problem is to expand and diversify the portfolio of your products to offer the customers something interesting during the slower periods in-between. Also, you can use smaller holidays like Veterans Day and Father’s Day to roll out enticing discounts and create revenue pockets that will be smaller but far more frequent.

Put a fresh spin on the marketing strategy

This strategy can be especially effective in the tourism industry. For instance, if you are marketing your place of operation as a summer retreat covered in hot beaches and fresh cocktails, you can’t expect to see much cash as soon as autumn settles in. So, why wouldn’t you put more focus on the local customs, history of the place, cultural events, autumn fests, nearby landmarks, and, why not, even kick-start some small but alluring local event? This small focus shift can open you the doors to yet untapped customer pools (in this case, families with kids) and keep your business profitable for a good part of the year.

Keep an eye on the cash flow and debts

In other words, you have to have a plan B for the scenario when your revenue will not be able to cover the expenses throughout the year. In this scenario, your priority should be to be able to repay debts and gear up for the next season. So, set up the contingencies as soon as possible so you won’t have to make any sudden and ill-advised moves when the troubles finally start kicking in. One of the most popular options you have on the table is fast debtor finance that, in some cases, allows you to repay 85% of your invoices within 24 hours allowing companies in need some much-needed off-season flexibility.

Do your best to manage off-season expenses

The measure we have listed above will enable us to get a quick financial injection and keep the cash flow alive in the worst-case scenario. Of course, this shouldn’t be your only and long-term strategy. Ideally, you should put more effort into understanding and managing your expenses during the slower periods of years. For instance, moving on to cloud-based services and outsourcing some non-critical business activities will allow you to scale down off-season if you notice the expenses are going out of hand. Renting unused assets is another way to make some money while cutting maintenance costs.

Make an expansion to the ecommerce sector

This move will incentivize your customers to spend more money offseason by offering them an option to purchase without leaving the home. Still, as enticing as this proposition is, you should do your best to kick-start your online store with annual subscription discounts, referral programs, calls to action, and other popular strategies aimed at temporarily boosting sales. What’s great about this entire expansion is that with well-thought-out and implemented marketing you can create a pool of customers that weren’t interested in your products or services prior to ecommerce expansion.

Establish secondary income flows

Last but not least, we would like to remind you that sometimes the best way to establish a seamless cash flow for your seasonal business is to seek it outside your native industry. Granted, you don’t have to go all-in and try to rebuild your business from the grounds up in some more consistent but even something as simple as starting a blog, opening up a gift shop, offering the logistics and transport services to other small businesses can help you not only stay afloat but also soar up and branch out in some completely unexpected directions. There is really no bad way to earn more.

We hope these few mentions will help you to keep your seasonal business (or any business in general) profitable during the slower parts of the year or even come up with some ideas of your own. Every problem looks difficult until you actually start working on the solution. Seasonal businesses are no different and now you know where to start.