14 Strategies That Will Help Seasonal Business Avoid ‘Sales Decline’

Some retail and service businesses achieve their highest sales during certain seasons. For example, a landscaping business may have a brisk business during the summer, while a holiday decorating service will likely have higher sales at the end of the year. Indeed, many retailers, regardless of product, see their biggest sales during the year-end holiday season.

Because of this, retailers and seasonal services often experience periods of annual “slump sales”. However, this does not mean that the team should sit idle or that there are no smart strategies that can strengthen the financial position of the company. To ensure your business doesn’t fall into the red during periods of slower sales, below, 14 members of the Forbes Financial Council share steps to help ensure financial health throughout the year.

1. Ensure positive operating cash flow

Stay ahead of seasonal slow periods by ensuring your operating cash flow is positive and setting aside reserves before the slow season begins. If your business doesn’t seem to have enough cash flow to cover expenses during a slow period, you may need to obtain short-term working capital or a line of credit to bridge the gap. – Xan Myburgh, Backd Business Funding

2. Carefully manage the money cycle

As your business enters a seasonal crunch, the financial leadership team must manage the cash cycle and control elements of working capital as you spend profits from other quarters. It’s also important to manage your relationship with the bank and have a line of credit you can draw from. Also, work with your marketing and sales teams to promote off-season sales through discounts. – Bilal Surahyo, Land of Sleep

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3. Keep looking for new clients

Continue to build your channel and attract potential new clients. If you slow down your marketing and prospecting during the slow months, it’s inevitable that the following months will be slow as well. If you keep looking for new clients, they will come after the holiday season is over. – Christina DeSimone Nappi, The DeSimone Agency Inc.

4. Increase your marketing efforts in the New Year

Use the “surge” of revenue and profits you might get during the holidays to maintain, if not increase, your marketing efforts in the new year. Many companies often cut back on this line item during times like this, so it naturally contributes to a slower first quarter in the new year. Don’t be like the herd or the norm in your industry; apply this strategy instead. – Christopher Hurn, Fountainhead

5. Work closely with suppliers and look for savings through technology

We use two useful strategies to maintain financial health. First, we ensure regular discussions with our suppliers to ensure we are maximizing the services in our contracts or to renegotiate services we are not using. Second, we regularly conduct technology audits to ensure we are scaling and leveraging all the automation functions available to us. – Paul Blanco, Barnum Financial Group

6. Diversify your products or services

Cash flow is often a problem for seasonal businesses. One approach a company can take is to diversify its products or services to earn more revenue outside of the peak season. For example, a landscaping company that is traditionally busiest during the summer might consider offering fall cleanup and snow removal services to generate year-round revenue. – Jeff Call, Bennett Thrasher

7. Stop big expenses and save part of seasonal income

Figure out ways to break up larger expenses and pay them off gradually over the course of the year. Make sure you hide a percentage of the money you bring in during the seasonal slump to get you through the lean times. Also, assess whether there are any expenses you can reduce or eliminate in Q1. This seems simple, but the goal is to have cash on hand and avoid monthly or quarterly high costs. – Paul Davis, Strategic Resource Management

8. Focus on long-term planning

The slow period is an opportunity to work on longer-term planning. Spend time understanding and building relationships with your customers. Refresh your marketing materials and plan new campaigns to increase your reach. See how your competitors differ in the market. And ensure that you and your employees stay up-to-date with training that can strengthen your business. – Luz Urrutia, Accion Opportunity Fund

9. Be financially and mentally prepared

Ask yourself, “Can I make some cuts in the new year?” and “Are there any ready-made ideas that I can implement in my business?” More importantly, you should never waste a slow season. It’s a great time to look at your business from a cost perspective and clear things up to make sure you’re at an advantage when things turn around. – Joe Camberato, National Business Capital

10. Increase the visibility of your brand on the Internet

Use your most valuable asset wisely by increasing your brand’s visibility online. You should advertise your business by posting on social media networks such as Facebook and Twitter, as well as posting pictures of your products on Instagram and Pinterest. This will help increase website traffic and attract new customers who may not have heard of you before. – Neil Anders, Trusted Rate, Inc.

11. Safe access to working capital

Make sure you have access to working capital (either through cash reserves or working capital) to ensure the business can continue to operate comfortably during the low season. To ensure success, it is important to position the company so that it can continue to operate according to its strategic plan rather than reacting based on the available cash in the bank account. – Sean Frank, Cloud Equity Group

12. Expand into new markets

One strategy a seasonal business can use to maintain financial health during a slow period is to consider diversifying its services or products. This may include offering additional products or services such as maintenance plans, extended warranties and customer loyalty programs. Also, companies can explore new markets and customer segments to take advantage of untapped opportunities. – Angelo Ciaramello, funded trader

13. Overestimate required reserves

If you know you’re heading into a sales slump after a big holiday season, you should plan accordingly. Set aside enough money to see you through the slow months and be careful with one-time spending during this slow period. Also, overestimate the reserves you will need – double or triple your estimate, as it is much better to have more money in reserves than not enough. – Joseph Orseno, Tiltify

14. Be smart with your cash in the fourth quarter

Cash is king in any business. Practice discipline with holiday profits. If you know that the holidays are a big time and the first quarter of next year is a short time, be smart with your money. Postpone capital expenditures or take out a loan to ensure you have cash on hand. Managing cash wisely reduces stress and gives entrepreneurs room to dream bigger. – Todd Sixt, Strait & Sound Wealth Management LLC

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