At first glance, a seasonal business looks like a dream job. Hard work and long days during a peak season followed by several months of relaxation on all the accumulated cash. But that’s not really how entrepreneurs succeed in a seasonal business. They actually work year-round.
More importantly, the seasonal nature of their businesses requires that they manage operations differently during off-peak periods. This means that starting a seasonal business requires you to be a careful planner. Plus, you have to be willing to work twice as hard during peak season as conventional business owners.
Despite the challenges, many entrepreneurs thrive on the seasonal business. You can actually learn to enjoy both the peak and off-peak seasons. That is, time seems to fly by during the peak period. In fact, this is a consequence of a well-organized business. After all, during the peak there’s not much time to make major changes. Everything has to pretty much function automatically. During off-peak time, you’re planning for efficiently repeating the process.
The first characteristic of running a seasonal business is being financially disciplined. You have to strictly monitor expenses. In addition, what you spend off-peak has a delayed impact on profit margin during peak selling. Therefore, you have to keep a wide view of overall profit margin and not become focused on profitability of a narrow period.
In addition, the off-season is the time to implement improvements. Taking advantage of the off-peak involves preparation for the next peak. That’s when you add new technology or staff. The off-peak period is also the time to revise and improve marketing. Some seasonal businesses continue promoting during the off-season. But others simply plan ahead for the upcoming peak-season marketing campaign.
Another feature of a seasonal business is maximizing profitability during the peak. You have to control spending during the peak season in order to retain cash for the rest of the year. Moreover, peak season is the time to assess what ideas work best. This information is converted into the changes made during off-peak.