7 Tips for Managing a Seasonal Business Maneuver around any slumps and downturns with some proactive planning.

By Stephen Sheinbaum

entrepreneur daily

Opinions expressed by Entrepreneur contributors are their own.

Shutterstock

One well-known challenge that any entrepreneur might face is navigating seasonal fluctuations in the businesses or industry. The key to doing so successfully involves developing skills and smart practices that will allow the company to remain profitable during off-seasons and periodic slowdowns.

A seasonal fluctuation can result from dips in customer demand or supply issues.

No one can prepare for every possible contingency, but consider these seven tips for developing and sustaining a season-proof business. Here are seven tips to consider:

Related: 4 Ways to Keep Seasonal Employees Engaged

1. Understand the cycles in your industry.

Rapid growth of a company is not unusual for business owner who's new to an industry. And that can disguise a normal seasonal fluctuation, leading the entrepreneur to expect the healthy sales will continue.

Base projections about seasonality on sales data from at least two or three years. If the business hasn't been around that long, check with peers and industry sources.

2. Fortify planning skills.

"Measure twice, cut once" is an old adage that still rings true, especially for a new business.

Look ahead at least six months to plan appropriately. To carry the business through slower periods (the shoulder season) and complete lulls (the off-season), considersocking away cash reserves during the busy months.

Look hard at every element, from inventory to staffing, to avoid tying up cash unnecessarily during quiet months. And don't forget to take advantage of slow stretches to prepare for the peak season.

Related: 6 Ways Food Trucks Can Survive the Winter Freeze and Grow Their Business

3. Build alternative income streams.

Although it might seem like a diversion from the core business, set up additional revenue sources to counteract the off-season. Just don't let attention to the alternative stream overtake a focus on the primary business.

4. Customer promotions need to be countercyclical.

Don't overlook the opportunity to take advantage of times when competitors may be in quiet mode. Target audiences are often just as accessible before a busy season as during its peak.

5. Be creative about staying in touch.

Set apart a business by making a point of maintaining visibility throughout the year

Even if regular clients aren't much in contact during the off-season, they might still be around. Be creative about finding ways to stay in touch with them all year round. It's a great way to turn one-time customers into repeat clients.

6. Manage the impact of seasonality on staff.

Hiring employees, including manager-level talent, is a critical factor for success. In some cases, there's simply no getting around the seasonality factor and short-term contracts are unavoidable.

Just be sure to manage expectations of seasonal workers. Be clear about the length of the job and keep abreast of important issues like full-time and temporary regulations and developments surrounding the minimum wage.

7. Select a clued-in funding partner.

Make it a priority to cultivate a relationship with a funding partner with a firm grasp of the industry and its seasonal nature. A funder with experience dealing with similar businesses can help facilitate what's needed for anticipated expansion, hiring and other capital investments.

Seasonality affects nearly every business, with few exceptions. But building seasonality into the business plan will go far in ensuring success.

Related: 4 Ways to Keep Seasonal Employees Engaged

Stephen Sheinbaum

Founder, Bizfi

Stephen Sheinbaum is founder of Merchant Cash and Capital

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Editor's Pick

Related Topics

Business News

He 'Accidentally Discovered' a Semi-Passive Side Hustle in College — Now He's on Track to Make More Than $500,000 This Year

When a lack of funding put a stop to Zach Downey's pizza vending machines, he stumbled upon another lucrative idea.

Business Ideas

55 Small Business Ideas to Start in 2024

We put together a list of the best, most profitable small business ideas for entrepreneurs to pursue in 2024.

Business News

Apple Faces Class Action Lawsuit Over iCloud's Alleged 'Enormous Structural Advantage'

The lawsuit asserts that cloud storage on iPhones would be "better, safer, cheaper, and more prevalent" without Apple's policies.

Marketing

The Rules of SEO Are Changing — Here Are 5 Powerful Strategies to Help You Rank in 2024

Do you need help to rank well on Google due to new algorithm updates? Discover five SEO strategies that work in 2024.

Business News

Here's How Much Amazon's Typical Customer Makes, Plus How Much They Spend on the Platform Per Year

A retail snapshot from data company Numerator paints a picture of who shops at Amazon and where they usually spend their money.