Seasonal businesses can be both profitable and difficult to run in Louisiana and around the country. They often have massive profits from holidays and the days and weeks surrounding holidays. Profits from that period are supposed to last for much of the year. As a result, these businesses require disciplined owners and constant strategizing during both busy and slow periods. They all must take a number of steps to ensure that they can survive months of losses and still remain in business.
Hoard cash reserves
Seasonal businesses derive a large percentage of yearly sales from a short period of the year. But the company will have to pay out expenses all year long. Seasonal businesses have to pay rent, electricity bills, business law expenses, and a wide variety of other expenses to other vendors. This requirement goes against the tendency many business owners have to either enjoy the profits from successful months or quickly pour profits back into capital improvements.
In the case of seasonal businesses, they absolutely have to keep high cash reserves at almost all times. They need to be disciplined at saving a percentage of their earnings from high-traffic months to pay off expenses in lean months. Seasonal businesses can take advantage of CDs, savings accounts, and other instruments that allow them to make small amounts of interest and put their money to work.
Keep connected with customers
Seasonal businesses often have issues with retaining customers. It is difficult to maintain relationships when a customer may go weeks or months without making a purchase. In order to maintain relationships, seasonal businesses should have offseason inventory sales either in-person or online. They should also keep up with their customers on social media and through email. Businesses can send customers deals, advertisements from other businesses, and surveys or reminders about the start of their seasons. All of these interactions can help seasonal businesses make the most out of their otherwise lean months.