How Do Seasonal Businesses Survive?

Seasonal businesses survive by implementing creative strategies to adapt to changing weather.

9 Ways Seasonal Businesses Survive

1. Form business partnerships

Seasonal businesses must find ways to get customers during the off-season. So, they partner with other businesses.

Let’s use a ski resort and lemonade stand as an example. The ski resort can direct visitor traffic from the slopes to the stand. Skiers want refreshments anyway after finishing for the day. Lemonade will help quench their thirst. It doesn’t matter if it’s wintertime.

Business partnerships are vital to seasonal businesses. These mutually beneficial relationships help everyone get through the downtimes.

2. Give out discounts

Another way seasonal businesses get customers is by using discounts. Every business has a profit margin. During the off-season, smart seasonal businesses use coupons to intentionally lower margins. It’s better to have some profit than no profit at all.

Before giving out discounts, businesses must know what their breakeven point is. They need to avoid selling products below this level if they want to make money.

3. Be adaptable

Ski resorts become mountain biking destinations in the summer. Similarly, ice skating rinks are converted into swimming pools. Seasonal businesses think of ways to use their spaces for weather-appropriate activities.

These businesses also sell weather-appropriate products. For example, frozen yogurt places sell hot beverages in the winter. They already have most, if not all, of the required ingredients.

4. Master cash management

In general, businesses survive if they can keep up with expenses. That’s the bare minimum. The bar is obviously higher if a business wants to thrive. However, by simply paying off bills, businesses will avoid bankruptcy.

Seasonal businesses survive by having good cash management skills. The business owners are financially literate. They regularly check business bank account balances. They understand how much revenue is coming in on any given day.

Today, seasonal businesses also track relevant metrics using software applications. That way, they instantly know when something is wrong. They roll up their sleeves as soon as they get a troubling notification on their phones.

Ultimately, all of this means that bills are paid and the businesses stay afloat.

5. Build more businesses

As a seasonal business owner, you should consider starting more businesses to protect your income.

For example, you can start another business that counters the drop in revenue. If revenue peaks in the summer, then start another business with revenue peaking in the winter.

You can also try starting a non-seasonal business with consistent revenue year-round.

In a nutshell, seasonal business owners survive by having multiple businesses. Over time, their companies are structured as holding companies with various brands inside.

They start small. They focus on one business and make it successful before starting another business. This diversification decreases risk. The business owners can then make a living regardless of the time of year.

6. Get access to credit lines

As a seasonal business, what do you do if you are short on cash? Occasionally, your expenses might outweigh your revenue. In these situations, you must borrow money to make up the difference. You can try getting a business loan with a favorable interest rate.

Financial institutions will more likely say yes if the business has a good credit score. In case you didn’t know, businesses have credit scores just like individuals. Companies with good credit scores have reputations for paying bills on time. Lenders will then be more willing to underwrite loans with low-interest rates.

7. Utilize relationships

Besides relying on a good credit score, seasonal businesses can also get a loan by using their connections. They might know a loan officer on a first-name basis. Asking someone for a favor is not as difficult when you have a long history of working together.

In addition, the business owners can borrow money from friends and family. This is another type of relationship.

Ultimately, seasonal businesses survive when they can get the funds that they need.

8. Get repeat customers

Seasonal businesses also try to increase their recurring revenue. They don’t just want customers to visit once. They want them to come back every year. How do they do this?

Firstly, they focus on creating exceptional experiences. Let’s use an amusement park as an example. It’s a classic summertime destination.

Amusement parks want to create rides so fun that visitors can’t wait to come back. The parks want loyal customers to become the norm.

Also, seasonal businesses try to eliminate sources of inconvenience. For example, no one likes to wait in long lines at amusement parks. It’s stressful and tiring.

So, the parks try to make the waiting process as bearable as possible. They create shady areas using natural and artificial props so that customers don’t have to wait in the sun.

Ample food options are available so that people can have things to munch on as they wait.

9. Minimize expenses

During the off-season, seasonal businesses expect revenue to decrease. They would be surprised if it doesn’t. Thus, they try to decrease expenses at the same time. Do whatever it takes so that the business can still have a net income as opposed to a net loss.

Of course, there are some expenses that you can’t change. For example, rent is fixed. It’s the same amount month after month until you get a new lease.

However, there are some expenses that you can change. Labor is one of them.

Seasonal businesses don’t need as many staff during the off-season since they don’t have as many customers.

It doesn’t make sense to have the same number of staff year-round. Some workers will have nothing to do.

So, seasonal businesses hire temporary workers. They are upfront with how many months these workers are expected to work.