Many retail businesses are subject to widely varying seasonal demand. Products that enjoy increased demand during the warmer spring and summer months or the Holiday season provide a huge revenue boost for many small businesses during the busy months. Restaurants and foodservice businesses, clothing stores, and specialty retail stores often see increased revenues through seasonal demand. In this article, Executive Vice President at United Car Care Rory Angold provides some practical tips for getting ready to reap the benefits provided by seasonal retail sales.
Businesses with seasonal retail performance should keep a year-round perspective on maximizing the value of their highest revenue months. Many businesses that have strong appeal during warm weather benefit from broadening the products and services they offer to keep customers interested during fall, winter, and the typically busy Holiday season. Likewise, firms that specialize in wintertime and Holiday season sales can find shoppers who enjoy gift shopping all year long.
Full-time employees are generally more productive and loyal than part-time seasonal employees, and expanding seasonal offerings can justify keeping more employees on board throughout the entire year. Some seasonal businesses make enough money during their busier months to allow using the off-season for planning, expansion, and scheduling for the full calendar year.
Perhaps the most important thing a seasonal business can do is to carefully evaluate the performance of previous peak seasons to plan for the upcoming season well in advance. An honest and critical examination of the things that went right and those that did not can give valuable insights about how the upcoming season can be better managed.
There are some major areas of management that every seasonal business should examine. Staffing is usually the largest single contingent expense for seasonal businesses. Determine whether you had sufficient and reliable staff in place or if there were too many employees on board at some or all times of the peak season. Analyze inventory as well. If you found supply shortages of popular items or find that you have inventory left over to be stored through the winter, make adjustments accordingly. Also, use the offseason as the best time to maintain or expand your business space and equipment well in advance of the rush of the beginning of the busy season.
If your business does not rely exclusively on in-person retail sales but operates at least in part as an e-commerce internet retailer, think about marketing and selling in locations with different seasons than your local area. If you are located in New York, your products are likely to enjoy a longer warm weather season if you market to consumers in California and Florida as well. If you sell outdoor recreational equipment that is centered on warm weather purchases, consider marketing in regions and countries like South America and Australia where spring and summer occur as we are in fall and winter.
Base your expense budget on how sales expectations differ between in-season and off-season months. Set hours of operation from month to month to capture peak hours and to avoid wasted staffing overhead and other costs during slow times. Determine if you might be able to sublet some or all of your space during slow periods to reduce rent expenses. Make arrangements when possible with vendors to reduce or suspend purchases during your business’s offseason.
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