It’s very common for companies to experience fluctuations in business and revenue, busy times and slow times – and this can often be based on the seasons or weather. For instance, retail businesses can experience as much as a 15% increase in sales the month of December and then fall to 30% below average after the holidays. And certain vacation resorts may be so slow in the cooler months that they decide it’s not profitable to even stay open beyond their bustling summer season.
By Kathy Bradshaw
Experience Chattanooga (Above Photo Courtesy of Experience Chattanooga)
Experience Chattanooga brings you on scenic hikes in the Chattanooga area, providing breathtaking views such as this one.
According to the Chattanooga Tourism Co., some 3 million tourists come to the Scenic City every year, spending up to $1.16 billion annually. But tourists can be fair-weather friends – nearly 90% of visitors come to Chattanooga outside of the winter months. This means that, depending on their industry, many businesses are bound to experience a lull of varying degrees at certain times of the year. And for those companies that want to stay open and operable year-round, keeping things going during the slower season can sometimes require some resourceful or creative business decisions.
We talked to several local companies that experience a slow-down when summer vacation ends, visitors seek warmer climates, and less tourists come, and they told us how they get through the off-season.
Locals Only Gifts & Goods (Photo Courtesy of Locals Only Gifts & Goods)
This Northshore gift shop features locally produced gifts, artwork, food, and clothing.
The two biggest challenges that many companies face when it comes to seasonal business are staffing and cash flow. When the bulk of revenue comes in during a restricted timeframe, planning and resourcefulness are involved to spread income out enough so that it lasts through the slow season, including reducing spending to just the essentials.
“We must save a portion of our profits to sustain us through the leaner times,” says Danielle Landrum, owner of the Northshore gift shop Locals Only Gifts & Goods. “We also use a portion of our summer-season profits to invest in inventory for the holiday season and a portion of our holiday-season profits to finance our business growth plans for the upcoming year. It takes some planning to make sure that we have what we need during the busier times and that we do not purchase more inventory than we need during the leaner times.”
Tim Andrews, president of the Tennessee Valley Railroad Museum (TVRM), agrees. He lists being careful not to spend unearned revenue, as well as having sufficient cash reserves to carry fixed costs through the slow season, as two of his company’s biggest difficulties. “There is a considerable disconnect on the revenue side between sales and when the revenue is earned. We sometimes sell tickets up to six months in advance but ‘earn’ the event revenue when it occurs,” he says.
Many companies also cut back on staff during the off-season. They rely on a skeleton crew of primarily full-time employees and bulk up on seasonal help when business picks up. But for some employees, such fluctuations can mean reduced hours and pay while things are slower. And those employees may also need to be versatile and willing to take on varying roles to fulfill the sometimes-inconsistent needs of a seasonal business.
“Staffing is the most difficult process in our business. As an attraction, our peak seasons are when most folks vacation, and we vacation when most folks work,” says Hugh Morrow, President and CEO of Ruby Falls. “Because of this, we have a sizable cross-trained, part-time and seasonal workforce that can be flexible with their schedules. Cross-training gives our staff the ability to work in multiple operational areas, depending on the season.”
Ruby Falls (Photo Courtesy of Ruby Falls)
Take a glass-front elevator down 260 feet into an underground cave, where you can view the deepest public cave waterfall in the United States.
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“It can be challenging to manage labor,” Landrum adds. “We must balance the needs of our employees who depend on a stable income with our reduced labor needs during the off-season.”
“Keeping full-time, year-long employees busy in the slower times is a challenge,” Andrews agrees.
To help bridge the off-season gap, some businesses add additional products or services during slower spells to bring in more customers when they might not otherwise come. Rock City Gardens features its Irish festival, called Shamrock City, in March, and their popular Christmas lights display, the Enchanted Garden of Lights, in November and December. Ruby Falls offers a haunted attraction known as Dread Hollow in October and after-hours Valentine’s “Romance at Ruby” events that, Morrow says, usually sell out weeks in advance.
The railroad museum has taken on a similar tactic. “It used to be that TVRM closed immediately after Thanksgiving weekend and reopened in late March,” Andrews says. “Development of Christmas events and Valentine’s dinner trains have shortened the slow season. Now, during January and February, we are at least open on weekends and holidays.”
Locals Only adjusts their business model to push their online sales when foot traffic to their store dwindles. “In our business model, we have a retail brick-and-mortar gift shop, an e-commerce website, and a gift box business. We leverage those different revenue streams to offset each other when seasonal business slows down,” Landrum explains. “For instance, when the brick-and-mortar store enters a slower season, we leverage our gift box business by increasing marketing to business professionals who purchase and give business gifts.”
Rock City Gardens (Photo Courtesy of Rock City Gardens)
Lover’s Leap and the High Falls waterfall are just the beginning of the spectacular scenery along the 4,100-foot walking trail at Rock City Gardens. The Observation Point atop Lover’s Leap is 1,700 feet above sea level and allows views of seven states.
Similarly, to keep things running even in the colder months, Hope and Ryan Maum, owners and guides of hiking tour company Experience Chattanooga, make special accommodations. “The biggest adjustment for us in the wintertime is making sure that we have warm clothes for our customers and ourselves,” the couple says. “If necessary, we’ll provide our customers with extra jackets, gloves, and hats for their time outdoors with us. Getting cold out there on the hiking trails is no fun for anyone!”
Rock City has the unique advantage of being a part of the umbrella company, See Rock City, Inc., which “has multiple hospitality businesses that include attractions, lodging, events, and restaurants,” President and CEO Susan Harris explains. This includes a season-resistant conference center, museum, and Starbucks franchise. Therefore, when one or more of seasonal businesses experience a seasonal slow-down, they can lean on the other partner companies to carry them through to the other side.
Being a seasonal business does have some advantages, however. Many companies benefit from the relevant downtime of the off-season by preparing for when things pick up again. The Maums say that when things are slow, they scout out new hiking trails to add to their tour itineraries and “dream up new ideas for fun spring and summer tours!” Locals Only takes inventory of their stock, reviews sales trends in their store and among consumers in general, and plans out what new inventory they’ll order for the high season.
Tennessee Valley Railroad Museum (TVRM) (Photo Courtesy of Tennessee Valley Railroad Museum)
Pictured here are two of TVRM’s operating steam locomotives, both built in the early 20th century for the Southern Railway. The engines have been restored and maintained by the museum, and today, these historic locomotives pull passenger trains on museum routes.
Many of our area’s seasonal businesses focus on necessary upkeep and maintenance in the slower months of January and February. For Ruby Falls, this involves “building, fixing, or sprucing anything up, even for non-seasonal business operations,” Morrow says. And TVRM takes advantage of being open only on weekends to “repair the wear and tear from the main operating season,” Andrews explains. They also have a legally required annual inspection of their steam locomotives that can be conveniently taken care of during the off-season. As for Rock City, they use the less-hectic time period to work on internal projects, plan for the busy season, and increase the training of their staff.
No matter what these businesses do to get them through the off-season, they have what it takes to persevere – whether that’s thanks to good planning, excellent business practices, or their favorable reputation with both locals and out-of-towners.
“Customer reviews and word-of-mouth have gone a long way in giving people confidence that they can book a tour with us and have a great time, regardless of the season,” the Maums of Experience Chattanooga say.
“We believe that our commitment to our mission and culture is the foundation that facilitates our team’s success and will carry our organization forward for the next 90+ years,” adds Harris of Rock City.
