How Seasonal Is Your Business?

scooterFinding out how your business changes at different times of year can be something that many business owners learn in their first couple of years as a company. Being able to predict seasonal changes to demand, and even how different types of marketing fare better at different times can allow you to be more effective.

Of course, for some types of business it is obvious where there may be seasonality – if you work in tourism, for instance, you will have an idea from the outset of when you can expect your busy times to be, and when you need to be pushing most for sales. However, some surprising types of business can have big seasonal differences, and even things you might expect to be roughly the same all year round can show trends that correlate to holidays or seasons.

So, what really defines seasonality, and how much does it affect you and your industry?

Businesses with Obvious Seasonal Peaks

Let’s start with industries where there are clear seasonal peaks and lulls, or even closed times outside of those periods. Tourism and leisure travel are a clear example, with school vacation times always the busiest for recreational travel, and some activities that are related to vacations only and available at certain times of year when there are the right weather conditions.

Some other industries fall into this highly seasonal category too, even though they are operational all year round. Businesses related to weddings, for example, will have some demand all year round, but vastly more in spring or summer. Companies that sell products related to certain activities, for example skiing or beachwear, will have some business all year round due to international travel, but will see most of their sales at the peak times for their relevant activity.

Businesses like these can be fairly easy to manage the seasonality of, because it is universal across their industries and highly predictable. The ‘off seasons’ are spent trying to get what sales they can with promotions, and in doing the set-up work for the next peak season.

Businesses That Change Their Offerings Seasonally

The next type of seasonality is where the business has relatively stable levels of demand all year round, however what they sell and how they market it changes throughout the year. One example of this is fashion retail. Naturally the product lines on sale change to give people what they are looking for, for the current weather and fashion season, but there are also traditional sale periods between seasons when most retailers in this sphere run their biggest sales and discounts.

Another good example is the garden industry. Garden centers and plant nurseries will sell completely different products throughout the year, and may completely restructure their sites around this, so there are California greenhouses filling up their outdoor spaces in one season, and stocking up on Christmas trees in December.

This type of seasonality can also be quite easy to predict and manage but requires planning to ensure your business is diversifying at the right times and always has enough to offer to suit the season. A big part of this is also leveraging inherent busy times in the industry you are dealing in with the right promotion strategies.

Businesses with Hidden Seasonality

The type of seasonality that can be most difficult to manage is the less obvious seasonality that can occur in businesses where you wouldn’t expect seasonality to be a factor at all. A good example of this can be in business services companies. While it may not seem obvious, most office-based businesses that don’t have clear summer peaks tend to be quieter in July and August, simply because more key staff are on vacation than usual. This can make all kinds of services companies see a knock-on effect, for instance recruitment businesses tend to see less new vacancies at this time of year.

Customer behavior can also change seasonally even where you may not immediately expect it to. People may choose to eat out more in summer or spend more money on home improvement in spring. Did you know people tend to buy fewer books in summer, but spend more money in general when the weather is nice? Even businesses that relate to things you would think couldn’t possibly have seasonal demand changes can be affected in some ways, for instance there are more personal injury lawsuits in winter.

As you can see, there can be degrees of seasonality for almost any kind of business, and so it really pays to look at the data your business brings in and see where you could have seasonal differences you haven’t predicted.

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