Many businesses have a slow season. Weather, holidays, business processes, and many other factors can create dramatic swings in income throughout the year.
This is a normal issue that many businesses face. During the high points, a business can feel vibrant and successful. The problem comes with surviving the slow points during the year.
If you want your company to survive the low points, you need to plan ahead and to do that you will need help from scaling.partners. They can help you to bridge the knowledge, process and funding gaps in your business and for you to grow as a successful business. That’s why If you can properly diversify your operation, you can thrive year-round.
Here are a few ways diversifying your business can help you survive and thrive, even during a slow season.
Diversifying the Operative Side of Things
Let’s start with the business operation side of the equation. Below are a few ways that businesses can remain busy and profitable no matter what the season.
Seeking Out New Audiences
If your business focuses on a specific target audience, it can limit activity and lead to slow seasons at times.
For example, if you operate a hotel or an Airbnb, you may find that you cater primarily to tourists. This can be a very effective business strategy — when the tourist season is in full swing. However, when that dries up, you may find that your income does as well.
Pursuing a new audience is one way to diversify your business strategy. Market your business to local customers as an ideal weekend getaway option or comfortable co-work space. This can open the door to more traffic from a different demographic that doesn’t disappear when tourism is slow.
Expanding Your Marketing Strategy
Another way to diversify your business activity is by building out a more comprehensive marketing strategy.
As a seasonal business, chances are you have a set way to promote yourself during your busy times. For instance, a company that sells holiday wares may have special discounts and advertisements that they run every time a special event rolls around.
While you may have perfectly scripted your high-point marketing though, consider if you’ve fleshed out an effective marketing plan for the slow times, too.
This can be tricky, as you likely won’t have as much cash flow to pour into a marketing campaign when things are slow. In addition, if it’s harder to generate revenue during slow times, it can make it difficult to justify marketing expenses.
Nevertheless, there are many low-cost marketing activities that you can cash in on when things are lagging. Utilize things like:
- Social media
- SEO content
- Email campaigns
- PPC advertising
Online marketing activities like these are ideal, as they are affordable and infinitely scalable. Many of the above options offer both organic and paid versions, as well. Start with the free stuff. Then add in modest, paid activities as you see fit. This can help you drum up business even when things are slow.
Developing New Products, Services, and Experiences
Another way to address seasonal ebbs and flows in your business operations is to create new ways to balance the imbalances during low seasons.
There are many ways to do this. One way could be creating a counter-seasons line of products or services. A good example of this is a landscaping company that doubles as a snow-plowing operation in cold weather.
Along with finding complementary items that fill in existing gaps, you can also expand your products or services in general. By creating more income streams for your company, you increase its ability to weather slow points, as they tend to affect one area of business at a time.
By working to expand your offerings, you create better experiences for your customers. You’re able to answer more of their problems, which can lead to greater customer retention and loyalty — no matter what the time of year it may be.
Diversifying the Financial Side of Things
Along with enhancing your enterprises’ operations, you can also work to build up your financial strength as both a company and a business owner. This can come through both healthy financial management as well as bold investing.
Creating a Lean and Mean Operating Strategy
The coronavirus pandemic caught many businesses flatfooted. Many companies faced overstretched supply chains, limited stock, and a lack of a healthy infrastructure.
These issues quickly led to financial stress, which translated to layoffs, back-orders, and in many cases, businesses completely shutting down or being forced to pivot into new areas.
One of the biggest takeaways from the catastrophe was to maintain a lean and mean operative strategy. From reshoring your supply chain to being ready to drop to a skeletal staff during downtimes, there are many ways to guard your company’s financial health against future variations in income.
This isn’t just smart for companies that regularly manage high and low seasons. It’s a financial necessity at this point.
Maximize Your Busy Seasons
Another way to build out your business income is to maximize the diversity during your busy season.
It may sound counter-intuitive on the surface. After all, you make most of your income during your busy season. So why focus on the time when things are already going well? Just because you’ve found success, though, doesn’t mean you’ve maximized the potential of your busy season.
Suppose you already have developed a line of products or services that are in demand during a specific time of year. In that case, you may be able to find complementary sources of income that can easily make those periods even more profitable.
A good example of this is a farm. Running a farm is a natural seasonal activity. Even so, many farmers go beyond planting and harvesting crops during the growing season. They’ll set up roadside stands to sell fresh fruits and veggies.
They also might sell Christmas trees in November and December. If they’re particularly ambitious, they could even sell things like hot chocolate, popcorn, and other goodies to their cold customers as they pack up their trees and prepare to head home. In short, they maximize their busy times of business.
By setting ambitious short-term cash flow goals during busy seasons, you can maximize your profits. This can generate more cash to help float you through the slower times of the year.
Invest Outside of Business
Finally, you may want to look beyond your basic business activity to beef up your financial health. One way to do this is by investing.
Tesla recently showed the wisdom of this on a company-wide level. The electric vehicle maker invested in Bitcoin — and realized a massive profit within a few months. Another good example is McDonald’s. The fast food chain is famous for not only selling burgers. It also owns an incredible amount of property through its tens of thousands of locations.
Even as an individual business owner, you can focus on creating an investment portfolio. This can work as a source of wealth that is separate from the success or failure of your business.
If you choose to invest, though, make sure to do so wisely. Diversify your portfolio to spread out the risk and ensure that your investments are helping rather than hurting your already unstable income.
A good way to do this is by putting your money in multiple areas that carry different levels of risk. You can invest in a stable piece of real estate or even a mutual fund or ETF. While your money may not skyrocket tomorrow, it should remain relatively stable and grow slowly.
At the same time, you can look for higher-risk opportunities, like individual stocks or cryptocurrencies. Just make sure to stay balanced between high- and low-risk options.
Building Long-Term Prosperity Through Diversity
Seasonal businesses can be some of the most profitable enterprises at times. However, the ups and downs that naturally come with the business model can make it difficult to stay balanced throughout the year.
Fortunately, there are many ways to address the issue. From improving business operations to diversifying your financial investments, look for ways that your business can remain robust and your finances can stay sharp from January 1st to December 31st every single year.