Running a Seasonal Business

Find out what smart tactics these entrepreneurs use to ensure the success of their seasonal businesses.

No matter what industry they're involved in, most businesses have seasonal highs and lows. Yet like Santa, some companies--summer camps, ski schools and Christmas stores, for example--depend heavily on the revenue generated during a single season to carry them through the year.

Typically, seasonal businesses fall into one of two categories: those that can shut down in the off-season and those whose owners have to find another way to maintain cash flow during the rest of the year.

Scott Stillings' business firmly falls into the first category. Owner of Winter Sports School at Nub's Nob ski resort in Harbor Springs, Michigan, Stillings says his business is a model of great cash flow. 'This is such an open-and-shut business," he says. "We balance our books every week, pay every bill and everybody each week, and when we close the door at the end of the season, we know right where we stand. There's no carryover.'

The staff begins preparing in September for the ski and snowboarding season, which begins on Thanksgiving weekend. Stillings says opening day is the school's busiest, followed by the days around Christmas and then President's Day weekend. "Then we stay at a manageable cash flow level [the rest of the season],' he adds.

Because there's not much inventory and no permanent staff--Stillings hires more than 100 instructors each season--the doors close the second weekend in April each year. 'In April, we try to finish everything for the year and hash out what we should do for next year while it's fresh in our minds," he says. That includes updating literature, brochures and the website, so people can always access the next season's information.

"Then we don't do squat until August when we stuff brochures into envelopes,' says Stillings. 'Most years, I can take the whole summer off if I wanted to. If it hasn't been a good year, I can always strap my guitar to my back and go off and perform as a soloist or in a band.'

Pinching Pennies
'Obviously, in a [seasonal] business, you need to budget carefully to make sure you don't overspend or extend yourself past your capabilities,' says Dennis D. Vourderis, who, along with his brother Steve, owns Deno's Wonder Wheel Amusement Park on the boardwalk in Coney Island, New York. 'Maintenance, taxes and equipment financing all need to be based on a 12-month year, so you need to know you'll have enough funding to cover those expenses during the time you have no cash flow.' Having good credit, he adds, is a necessity in a seasonal business.

For the Vourderis brothers, whose parents purchased the amusement park and the Wonder Wheel--a Ferris wheel built in 1920 and declared a New York City landmark in 1989--the busy season runs from April to October. 'We face the beach, so we're 100 percent driven by the weather," Vourderis says. "If the sun comes out, people come to the beach, the boardwalk and the rides. If it's raining, it's not even feasible to open." Since a year's worth of business gets squeezed into six months, every sunny day counts. Vourderis uses July 4 as a benchmark for being in the black.

During the off-season, Vourderis stays busy, as he, his brother and their trained staff dismantle the seats and other parts of the rides and store them in a warehouse where they're painted and undergo maintenance, repairs and inspection.

Maintenance, repairs and painting also occupy the winter months for Jay Kandle and his family, who run Lake Kandle Campgrounds and Swim Club in Sewell, New Jersey. 'We like to winterize in October, right after we close," says Kandle. "We also take care of the pool, put away the rescue equipment for the lifeguards, do landscaping maintenance, rebuild old picnic tables and so on. We prepare for the coming year like farmers.' Kandle dedicates his entire year to the business, despite the fact he's only bringing in money from the campsites and swim club for close to eight months of it.

From tax planning to hiring staff, Kandle spends October through March gearing up for a season that will involve approximately 2,000 swim club members and campers visiting the 150 camp sites on nearly 20 acres. One thing that helps keep the Kandles in the black is the additional income they generate from renting out 40 additional acres of farmland, which, along with the campgrounds, have been in the family since 1892.

'My father and mother had the dream of opening a swim club and campground,' says Kandle, who has taken a slightly different approach to running the campground than his parents did. 'In my parents' day, January would have been a lean time of year. But by marketing the swim club to attract more business and taking deposits now, we're able to increase our cash flow during the off-season.'

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Rich Mintzer is a journalist and author of more than 50 nonfiction books, including several on starting a business. He hails from Westchester, New York, where he lives with his family.

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