2017-12-05 00:00:00 Growing a Business English Discover the benefits of diversifying your seasonal small business operations. Consider these factors when determining if you should... https://quickbooks.intuit.com/ca/resources/ca_qrc/uploads/2017/12/Woman-in-small-business-storeroom-discusses-diversity-for-operations.jpg https://quickbooks.intuit.com/ca/resources/growing-business/small-business-operations/ Should You Diversify Your Small Business Operations?

Should You Diversify Your Small Business Operations?

2 min read

Canada’s climate makes it ideal for seasonal small businesses. Just because the seasons come and go doesn’t mean your company’s revenue has to do the same. Diversifying your business operations to take advantage of other times of the year keeps sales consistent and avoids off-season slowdowns.

Cross-Promotional Opportunities

Does your seasonal small business lend itself to cross-promotional opportunities? For instance, if you own a ski resort, consider encouraging customers to return in the summer months to go hiking and fishing. Think about what products or services complement your seasonal offerings at other times of the year. If your business offers home gardening services during the spring and summer, consider providing snow and ice removal in the colder months for a complete home-maintenance service and improved business profile. Lure customers back in the off season by offering attractive promotions. If you operate a bed and breakfast, consider offering a bundled deal discount for customers who book summer and winter packages simultaneously.

Resources and Licencing

Before diversifying your seasonal business, determine if you have the necessary resources to do so successfully. Consider the costs involved, if your staff has the required skills, and what licences you need to conduct your operations. If you run a summer tour guide business and want to offer hunting tours in the fall, do your employees have the knowledge and skills to deliver these additional services without further training? You need to check if hunting permits are required and if you have access to restricted areas at other times of the year. Once you know what additional resources are needed, seek the advice of an accountant to determine if diversification is a viable option.

Online Store

If your seasonal small business primarily offers services, you might diversify by adding an online store to your website and selling products. If you run cooking classes mainly in the winter months, think about selling cookbooks and kitchenware year-round. Update your products at the start of each season to keep your range current and in demand. For example, stock your online store with holiday goods starting in early November. Toward the end of each season, issue your customers discount coupons for your online store to help sell unsold stock.

New Customers

Ideally, you don’t want your seasonal business to rely on a small group of customers for the majority of its revenue in case they decide to take their patronage elsewhere. Diversifying your business can attract new customers who provide additional income streams. For example, if your business offers summer lakeside accommodations for vacationing families, consider hosting conferences in your reception facilities to attract business customers. Another idea is to hold events, such as weddings and birthday parties. Sales generated by new customers in another area of your business helps generate cash flow more consistently throughout the year.

Diversifying your seasonal small business provides key benefits, such as keeping your revenue consistent throughout the year and increasing your customer base by offering additional products and services. Before diversifying your operations, be aware of the extra resources and expenses.

Information may be abridged and therefore incomplete. This document/information does not constitute, and should not be considered a substitute for, legal or financial advice. Each financial situation is different, the advice provided is intended to be general. Please contact your financial or legal advisors for information specific to your situation.

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