What to Do When Feast AND Famine is Built into Your Business

feast and famine revenue

Are you searching for different types of business strategies? Do these complaints or comments sound familiar?

“It’s my busy season” said the CPA. “We are extremely busy now” said the landscape contractor. “We hate winter” said the auto services owner. “Spring and fall are deadly for us” said the HVAC company owner.

Each of these owners is faced year after year with a low season when their revenue is a trickle. The low season may correspond to weather conditions or to a fixture of the calendar, such as the April 15 tax return due date. It may be due to cultural preferences that occur like clockwork each year, such as spring and summer weddings.

For these industries and many others, feast and famine are built in. Their low revenue seasons aren’t due to any lack of effort on their parts or to inconsistencies or carelessness. Low seasons are a natural occurrence every year. They need different types of business strategies.

Working harder to get more business in the high season doesn’t end the famine. If you add people and other resources to accommodate more demand in the high season, what will you do with those additions during the low season? Churn is very expensive and takes it toll on everyone in the company.

End the Famine

What if you look at your low season as a huge opportunity to do something entirely or substantially new?
There are 3 options:

  1. Another business line with an opposite high season
  2. Fold the high season work into an annual package
  3. Vertical expansion. Where does your main line of work sit in the supply chain? What comes before it and what comes after it? How can your company establish itself as providers of the ‘before’ and ‘after’ components?

Another business line

Have you ever asked yourselves what are your buyers buying in the seasons when they’re not buying your services? This is a serious question that requires intense focus and study. It is a fantastic question for internal business development workshops. Include people from different departments, such as marketing, sales, customer service, IT, product development, financial and strategy with a facilitator and discuss this question. You’re looking to uncover new business lines that will use the same resources as your current lines. The business line will generate revenue during the low season with approximately the same resources. This is a terrific way to end the famine.

Folding high season work into an annual package
This is a high-value approach to services that should be practiced more. If your clients and customers need certain services every year at one specific time, and also use other services periodically throughout the year, what package can you create that incorporates all of it? You turn what people think of as commodity services into one component of a high value package. The package is offered for an annual fee, payable monthly. Your company needs to be sure that it has the people, technology and service infrastructure that supports the year-long delivery of the value of the package. This ends the famine.

Vertical expansion

Economists define vertical expansion as bringing in-house the products and services your company uses to deliver your main offerings and/or bringing in house the post-purchase work such as delivery, service and retention. This looks different for every industry and individual companies.

It may be like starting a new business or it may be establishing a new division within your company that supports and services the main division. You will have many considerations in terms of strategy, costs, infrastructure, revenue and profit. You might accomplish vertical expansion most cost effectively by the acquisition of another company.

Don’t discount vertical expansion because it seems really big. This is also a great question for internal business development conversations with a wide range of participants, expertly facilitated.

How We Help

We’ve helped alleviate revenue famine for many client companies. If you’re thinking with dread about your next famine, let’s talk. All our client relationships begin with a complimentary Discovery call. If there’s a great fit, we agree about how to proceed.  Let us know when you’d like to schedule yours. 703-801-0345.

feast and famine revenue

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