How to Help Your Business Survive a Slow Season
Over the course of a year, many small business owners experience a shift in their revenue streams, customer retention, and production cycles. Though often associated with specific industries such as hospitality, the term “slow season” can actually apply to almost any type of small business. Whether you are a brick-and-mortar storefront or an online-oriented enterprise, chances are that you have noticed this seasonal trend. By following the tips below, you can learn how to help your business survive a slow season and mitigate its effects.
Plan Ahead by Managing Your Cash Flow
Just as a squirrel stores acorns in advance of a cold winter, you should plan ahead to ensure your business has enough cash to operate efficiently during the slow season. For example, during your busy season when profits are high, consider diverting a portion of those funds into a reserve account. It’s a simple step you can easily accomplish with advance preparation.
Work with Your Banker to Get a Line of Credit
It’s imperative to obtain and maintain a line of credit with your bank that can help your business during the slow season. This option is preferable to using company credit cards to offset seasonal cash flow fluctuations because you will typically secure a lower interest rate. You can learn more about how your PlainsCapital Bank commercial lender can help you obtain a line of credit to survive a slow season.
By reducing your expenses, you can continue to operate efficiently during the slow season. For example, if you own a nursery or greenhouse, it may be helpful to employ your workforce on a seasonal instead of permanent basis. Another helpful option is to limit your overhead costs, such as the amount of office supplies you purchase or the cost of electricity. Finding ways to reduce expenses can usually be achieved by careful analysis of where your profits are going.
Keep in Touch with Customers
Just because it’s the slow season for your business doesn’t mean you should neglect communication with your customers. An effective method is to maintain a mailing or email list and communicate on a consistent basis. Be careful not to oversaturate them with too many communications, but send enough so that your brand remains in their mind the next time they are ready to make a purchasing decision. Many email communication applications also offer an analytical feature that can help you learn what type of communications or what frequency is optimal.
Offer Discounts During the Slow Season
As mentioned above, the key to helping your business survive a slow season is to maintain an adequate amount of cash when your revenue streams dwindle. In addition to setting aside funds, you can also offer discounts on your products or service. This will not only help maintain liquidity but can also enhance your customer retention efforts. After all, what customer would not be interested in a discount on a product or service they use?
Consider Expanding Products for Longer Seasons
Another way to survive a slow season is to reduce its duration. In other words, research and identify how you can modify your customer offering to extend your busy season. For example, if you own a greeting card shop, you might consider stocking and displaying holiday cards earlier in the year, which could encourage more shoppers to purchase and help smooth out swings in your revenue stream.
In general, the keys to helping your business survive a slow season start with advance preparation and planning. For more information on how PlainsCapital Bank can help your enterprise thrive and operate efficiently, please visit the Small Business section of our site.