10 Tips To Manage Your Business Seasonality

Mantis Funding May 17, 2023

What is Seasonality in Business?

Seasonality in business refers to the cyclical nature of demand for products and services that change according to the time of the year. In contrast, a year-round business operates with consistent demand during all times of the year.

A seasonal business typically experiences fluctuations in demand throughout the year, with some periods of the year having higher sales than others. For example, a winter sports equipment outlet might experience more demand during the winter than in the summer.

How Do Businesses Deal with Seasonality?

One of the main challenges of a season-based business is managing cash flow. Since revenue is inconsistent throughout the year, it can be challenging to plan and budget for expenses, especially during the offseason when there is little revenue flowing in. Managing inventory is another challenge, as it can be hard to predict how much stock to carry during the offseason.

Some industries that face challenges associated with seasonality include retail stores, restaurants, and entertainment businesses. For example, retail stores usually experience higher sales during the holidays, while restaurants may experience lower sales during the summer when people are more likely to cook at home.

Similarly, entertainment businesses such as amusement parks may see higher attendance during the summer months but lower attendance during the colder winter months.

Some ways businesses prepare and handle seasonality include:

  • Diversifying product offerings: Companies can expand their product or service offerings to appeal to a broader audience during their off-seasons. For example, a ski resort can offer summertime activities like hiking or mountain biking to attract more customers.
  • Offering promotions or discounts: Businesses can offer promotions or discounts during slower periods to help maintain sales volume during the off-season.
  • Planning for cash flow: Companies should carefully plan for cash flow during slow periods to ensure they have enough resources to operate by reducing expenses, applying for a line of credit, or creating a budget for the off-season.
  • Optimizing inventory management: Proper inventory management is crucial for season-based businesses. Companies should adjust their inventory levels to align with fluctuations in demand to avoid overstocking or understocking.

Learn more about these and other ways companies can prepare for seasonal changes.

1. Prepare Your Finances to Handle the Downtime

Managing cash flow during the downtime of a season-based business is crucial for long-term success. Over-ordering can tie up a significant amount of capital in inventory that may not sell during the slower seasons.

Businesses should analyze sales data from previous years to determine the optimal inventory levels for each season. It’s also critical to build up a cash reserve during the peak seasons to cover expenses during the slower seasons. Setting aside a percentage of profits or adjusting pricing can help companies account for the cyclical nature of the business.

Additionally, carefully managing expenses during the slower seasons can help businesses maintain profitability. This may include reducing staffing levels, negotiating with suppliers, and cutting unnecessary costs.

2. Start Your Training and Hiring Early

In some industries, such as retail, businesses have to hire temporary or part-time employees in preparation for more traffic during peak times of the year. If companies wait too late to recruit new hires to account for the increased traffic, it could result in poorly trained employees who hurt sales and put additional strain on the rest of the team. One way to avoid this is to use the slower months to hire new employees and get them up to speed.

The slow seasons provide an opportunity to connect with senior employees and management and create a list of best practices and training processes that quickly get seasonal employees up to speed. Giving year-round employees a more central role in the training process will help them feel like they have a pivotal role in the organization and enable them to train new hires more efficiently.

3. Review Your Online and Physical Location Presence and Checkout Process

Reviewing your online and physical location presence is critical for ensuring your business can compete effectively. It’s essential to check that your local business information is accurate across the internet and to ensure that it compares favorably to the competition. Check for inconsistencies in business names, addresses, and phone numbers.

In addition, examining the checkout process can help ensure that users have a smooth experience. Businesses should check the steps to checkout, including the number of touchpoints per purchase, to ensure the process is streamlined and easy to use. This can involve simplifying forms, providing clear instructions, and offering multiple payment options.

4. Apply for Small Business Financing at the Right Time

When applying for small business financing, businesses should consider their present financial standing and project their future income. Businesses must ensure that they can make good on their payments later down the line. For many businesses, finding the right time to apply for financing can be challenging because of occasional dips in revenue and shifting changes in demand.

However, seasonal businesses typically have a slow and busy season, meaning it is easier for them to pinpoint the right time to apply for business financing. Financial services can also easily create a repayment agreement, as they can easily see what arrangements a seasonal business can fulfill based on the time of the year.

5. Analyze Historical Data

Analyzing historical data is essential for season-based businesses, as it can help them identify seasonal patterns and adjust their strategies accordingly. By examining data from previous years, they can gain insights into various factors that may impact their operations.

Businesses wanting to analyze historical data effectively should begin by collecting data on key metrics such as sales, revenue, and customer traffic. They can then use tools like spreadsheets or data visualization software to identify trends and patterns in the data.

For instance, a retail business can analyze sales data from previous years to determine which products sell best during certain seasons. Similarly, a restaurant might examine customer traffic data to identify which days of the week or times of day are busiest during each season.

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6. Stay Up to Date with Industry Trends

Keeping current with industry trends is essential for season-based businesses to remain competitive and adapt to changing customer demands. By keeping abreast of the latest developments in their industry, they can identify emerging trends and opportunities and adjust their strategies accordingly.

There are several ways that businesses can stay up to date with industry trends. For instance, they can speak with suppliers about new products, services, and technologies that may impact their business. Businesses can also attend industry conferences and events to network with peers, learn about emerging trends, and gain insights into best practices.

7. Maximize Your Downtime

Maximizing downtime can be a valuable strategy for seasonal businesses to use their slow periods to their advantage. While it is tempting to focus on generating revenue during peak seasons, taking time off during slower periods can provide an opportunity to review business models and improve overall processes.

One benefit of downtime is that it can allow businesses to step back and evaluate their operations objectively. Taking the time to reflect on the strengths and weaknesses of their business can help identify areas for improvement and implement changes that can help them become more efficient and profitable.

Downtime can also provide an opportunity to invest in employee training and development. Using this time to educate employees on new technologies or best practices can improve the skills and knowledge of their workforce, which can lead to improved customer experiences and increased productivity.

8. Work on Your Marketing Strategies

Seasonal businesses have a unique advantage over other companies whose product demand fluctuates throughout the year. The “Rule of Seven” states that potential customers need to hear a company’s message seven times before they will take action and purchase a product or service.

Season-based businesses have ample time during the off-season to prepare and enact a strong ad campaign leading up to their peak sales period. For example, a company that sells Christmas trees and decorations can begin its messaging sometime in the Fall, so when the time finally comes to buy these items, people will remember who they saw first.

9. Competitive Research

Competitive research can be a valuable tool for seasonal-based businesses to gain insights into their industry and identify growth opportunities. It can provide businesses with a roadmap for success by identifying strategies competitors employ to achieve positive results.

Conversely, analyzing competitors that struggle during the off-season can also help businesses avoid making the same mistakes. Identifying the factors that contributed to their competitors’ failures can help them pre-emptively address those issues and mitigate their own risks.

10. Consider Offering Off-Season Promotions and Discounts

Offering off-season promotions and discounts can help season-based businesses to maintain cash flow and stay relevant to their customers during slower seasons. One effective strategy is to discount excess inventory or seasonal products that didn’t sell as well as expected during the peak season. Offering discounts on overstock can help clear out inventory and generate revenue during the off-season.

Another approach is to offer promotions or discounts on complementary products or services that are popular year-round. For example, a beach resort could offer discounted spa services or other amenities during the off-season to keep revenue coming in.

When considering off-season promotions and discounts, it’s vital to determine the impact on profitability. Businesses should carefully calculate the potential revenue generated from the promotion and ensure that it outweighs the costs associated with the offer.


Seasonality is a challenge many industries face, but with careful planning and strategic implementation, it’s possible to navigate the ups and downs of the seasonal cycle. By preparing your finances, optimizing your online and physical presence, analyzing historical data, and staying up-to-date with industry trends, you can position your business for success during peak and off-seasons.

Remember that downtime can be an opportunity to review your business model, processes, and strategies to improve your business in the long run. Additionally, considering off-season promotions and discounts can help keep cash flow coming in and keep your business relevant to customers year-round.

At Mantis Funding, we understand the unique challenges that season-based businesses face. That’s why we offer funding solutions tailored to meet their specific needs. If you’re a seasonal business owner looking to take your business to the next level, we invite you to reach out to learn more about our services and how we can help you achieve your goals.

Contact us today, and let’s discuss your funding options!

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About Mantis Funding

Mantis Funding is a business financing solutions firm catering to small and mid-sized business owners in the United States.