In this blog we will consider why you get peaks and troughs in your balloons and venue decor business and the key things you need to do to reduce them and minimise the effect on your business.
When you are running a small business peaks and troughs in the number of orders in your diary can play havoc with cash flow. You can quickly swing from being run off your feet to empty weeks in the diary wondering how you are going to cover the outgoings. All business will suffer from this to some degree but most small businesses are not as fortunate as the bigger brands to have larger turnover to buffer cash flow. The stress of looking at an empty bank account and an empty diary can cause many a sleepless night and bring self-employed business owners out in a cold sweat just thinking about it.
So how can you reduce the peaks and troughs and minimise their impact on your business?
Understanding when the peaks and troughs come in your business.
It’s so important firstly to understand when the peaks and troughs naturally occur in your business. If you have been running your business for several years it should be easy to see the patterns but if you are in your first year it may be a little difficult to predict. Here is the UK I have found holiday seasons such as Mother’s day, Easter , Christmas etc to be especially busy, as is wedding season and bank holiday weekends. On the flip side it’s not unusual for January and February to be the quieter months of the year.
Consistent marketing during busy times
One of the biggest causes of peaks and troughs in business is inconsistent marketing. You market like mad in the run up to key events and then when you get really busy your marketing drops off as your time is diverted to completing orders. Suddenly as you come out the other side your diary is empty and orders have dropped off so you start marketing again and this creates a constant cycle of peaks and troughs in your business. Some business owners who have got stuck in this revolving door believe this is an inevitable pattern in business but actually it doesn’t need to be. In fact you absolutely should make sure it isn’t the case in your business. The problem with troughs is it makes it hard to grow your profit that you need to reinvest in your business. When you consider the social media algorithms it also makes keeping your reach up so difficult as each time it’s like starting afresh again. Too many troughs in a year can be the difference between growing a business that funds the life you want and “getting a proper job”!
To reduce the peaks and troughs in your business you first need to understand the patterns occuring in your business
Plan ahead to reduce the troughs and make the most of the peaks.
Once you know when your peak times and quieter times are it allows you to plan ahead and make sure you are getting your marketing organised for both. You should always have an idea of the marketing you need to do for the next 3 months in your business. Whilst it’s good to have an overarching plan for the year having more detail for the next 3 months gives you flexibility to do more of what works and change things that don’t. Have a plan in place for the key business seasons coming up and an action plan for the non seasonal months. Having a monthly focus plan for your marketing so it makes it so much easier to do as you don’t sit there with a blank sheet wondering what you need to be doing and you can maximise your income throughout the year!
Make sure you regularly check what events are happening locally during what you know to be quiet times in your diary. Regularly check the mayors diary, Facebook events and other event booking websites. Contact local sports clubs, local government, educational establishments, armed forces, special forces, restaurants, cinemas, theatres and retail to see what events they have during those months and get booked in early to minimise the troughs in orders and cash flow.
Get prepared for the busy times
Make sure you plan several weeks ahead of the busy period coming up and get your marketing scheduled on your social media. Facebook has its own schedular but the other social media platforms can easily be scheduled with apps. Newsletters can also be scheduled as can blogs for your website. Taking the time to set this up ahead of the busy times means you won’t be trying to wear a million hats all at once often with your marketing suffering and then coming out the other side to the despair of turning empty pages in your diary.
The efforts of your marketing often take several weeks to months to bring in the results you want. If you know there is a quiet time after the busy period, you need to be thinking about bringing in non-seasonally related events such as birthdays, new babies, christenings, anniversaries, corporate work etc.
Don’t forget to take time in your busy schedule to keep an eye on the weeks ahead and make sure you are getting back to messages and emails in a timely manner or they will assume you are too busy and take their business elsewhere.
Clever marketing to bring in cashflow during the quiet times
Even with the best plan in the world and consistent marketing there may be times where things are naturally a bit quieter. This is not a time to panic and try marketing to everyone in the hope of quickly securing orders. Instead it is a time to focus in on who your ideal customers are, the ones you really want to grow your business this year, and tailor your marketing so that it will get them knocking at your door ready to book with a deposit in their hand.
January is a key month where people are recovering from the Christmas spend and waiting until the end of the month for their next pay day. Instead of chalking it up to one of those things, and struggling through, think about what you can do to encourage cash flow in the business. January is a key month when potential customers are waking up to the idea they are getting married THIS YEAR! or have a big celebration or event to plan. Wedding planning and party planning often go on hold a little bit, around November and December, as everyone waits to get Christmas out of the way. January is a prime month to market like mad what you have to offer for them to get their big event sorted. Special offers (that make business sense – this is not a time to panic and put out silly offers!) and low deposits are a great way to encourage bookings in this month and keep cash flow up for your business. Take a look through your diary and work out what other months are generally quieter and see what opportunities there are for you to get the right customers who will grow your business booked for the following months with deposits secured.
Having payment plans in place for larger orders are also a great thing to consider for your business. By having customers spread their costs not only does it make life easier for them but it also helps reduce the troughs in cashflow during the naturally quieter times. You will need to have good terms and conditions in place an make sure you ringfence the money if they are paying outside of your cancellation terms and conditions but it can really help soften the blow of quiet periods to know you have a regular flow of income into your business.
Control your budget
By understanding when your natural peaks and troughs are in your business it also gives you the opportunity to control cash out of your business. You want to make sure you reduce costs in the run up to quieter periods and accrue some savings during the busier times to act as a buffer for the future. It is not uncommon to have annual bills for your website, insurances, and other annual reoccurring payments. Often you will have taken these out when you first started your business. If moving forward the recurring payments fall in a month that is going to be a quiet period in your business you need to either make sure you are putting the funds away during busy periods to cover the outgoings or speak with your suppliers and see if you can get them moved to times of the year when you know cash flows much better through your business.
Planning and preparation means you can reduce the troughs by clever marketing and where they do occur reduce the impact on your business.
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