The four seasons of the year might not affect your business directly, unless you are a farmer, but more or less seasonal factors play a role for every kind of business. For some businesses, for instance ski vacations, it is obvious when the peak is, while for others this isn’t so.
All equal, for the majority of businesses, except those that cater to this season/holidays, summer is a slow season. So are December and the 1st half of January. This means not only less work but also a drop in sales and as a result a drop in income.
Image Source: A Tree in Four Seasons via Shutterstock.
If you don’t know these seasonal fluctuations, when the low season comes, you will be unpleasantly surprised. In extreme cases you might even think that something is fundamentally wrong with your business because two or more months in a row you have steadily declining income and start all sorts of unnecessary changes in order to get out of the pit. Needless to say, this is not only useless but it can really break your business. You simply need to know your high and low season(s), so that you adapt your schedule and plan accordingly.
How to Know Your High (and Low) Season(s)
The simplest way to learn your high and low season(s) is to analyze your sales/income. This approach applies to any kind of business, be it a small food store, a huge online shop, or a software development company. If your business is mainly online, you need to check your logs, too and perform some analysis regarding search volumes and their trends.
However, in order to have more or less reliable conclusions, you need to analyze data from 3 or 4 years at least in order to spot a trend. Otherwise, the results you get might be just a coincidence and it will mislead you a lot.
One tool you can use for a more global outlook (i.e. to get a broader view of the industry as a whole rather than study your logs alone) is Google Insights to Search. The data it offers isn’t in the most usable form but it shows trends perfectly.
Of course, the simple analysis of search volume, number of hits, conversions, and money made as a result isn’t with military precision but for our purposes it will do. Always remember that other factors (for instance updates to Google search algorithm, new products you have launched, new competitors on the market, etc.) in addition to seasons come into play, so don’t take your conclusions as the ultimate truth. Rather, use them as a direction only.
How to Deal with Seasonal Factors
Correctly identifying seasonal influences is the first step to dealing with them. After you have done the identification, here is what you can do to counterbalance:
- If you have a business with drastic seasonal dependence (i.e. ski vacations), consider starting a business for other times of the year (i.e. a summer-related business). For many freelancers having a business with drastic seasonal dependence isn’t a typical scenario but if you have a site that does well in particular seasons/months only, you can avoid the drama by starting a site that will supposedly do well at a different time of the year. Seasonally-themed sites are the obvious culprit but almost any other niche has its seasonal variations. Even a niche like tech and computers tends to do worse in late spring and summer because people spend more time outdoors and care less about cute gadgets and awesome designs.
- Plan some rest for the low season. Even workaholics need rest every now and then, so one of the ways in which you can invest the more free time you have during the low season is to get some rest. When you are not tired when the high season begins, you will be able to perform better, so rest is really an investment.
- Try to make the most before the seasonal factors kick in. If you are a business, one way to make the most before the slow season starts is to run an ad campaign. An ad campaign boosts sales and most likely you will manage to sell more before the unfavorable season comes. You might try the opposite – run an ad campaign during the low season and hope the campaign will boost your sales (and most likely it will) but all equal, you will make less per dollar invested in ads than you would in the high season, which isn’t very efficient and in some cases might be a pure loss of money.
- Find projects before the slow season starts. For freelancers, the above tip translates to ‘find projects before the slow season starts’. When you have projects, you can work on them even if it is the slow season but if you don’t and you are starting to look for new gigs, then you will notice the difference. Clients tend to disappear all of a sudden, or answer with a huge delay. I remember a couple of years ago when a major project of mine surprisingly ended right before the summer, I applied to probably 20, 30, or even more projects without getting a response, not to mention landing a gig. Then when the slow season was finally over, I got response from more than a third of these projects and guess what, I was approved for a bunch of them and all of them were urgent. I had to turn down a huge part of them because I already had enough on my plate and couldn’t handle more but this was simply one more lesson that you should look for work when it is available not when you feel like doing it.
- Use the low season for R&D. One more way to take advantage of the low season is to spend it on Research & Development. To put it simply, you need time to prepare your new products. You can do it while the business is slow and be ready with your new product when things pick up again.
Seasonal factors are a strong force even for businesses that think are immune to them. You need to know these seasonal specifics and how they affect your business, so that you can plan accordingly and avoid the drama when all of a sudden, with no obvious reason your sales or the volume of your projects nose dive, leaving you penniless. Of course, I can think of some cases when I personally started great projects during the slow summer months or in late December but basically for IT these months are a bit slow and unless you have projects you have started before that, it is harder to find good projects when everybody (your clients included) is on the beach or is preparing for Christmas and New Year’s Eve.
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