Betsy Wise
Por: betsy_wise
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How Can a Business Loan Help Your Seasonal Business?

Do you have a seasonal business? Here’s a factoid you may not be aware of: Forbes Magazine in 2018 debunked a myth that seasonal businesses aren’t sustainable. In fact, SBA data indicated that seasonal businesses, ones that have periods of high and low sales, grew their businesses with a business loan and found other ways to diversify their income streams. They also took steps to increase cash flow to last all year.

12 Ways to Use a Business Loan for Your Seasonal Business

Businesses that experience cyclical sales during the year can use a business loan to provide income to pay ongoing expenses and provide working capital.

  • Maintain cash flow: When finding solutions to cash flow problems, keep in mind there are two types of seasonal businesses. The first type is high season businesses such as an ice cream truck located in a beach town that only operates in the summer or a company open during the winter that offers ski lessons. The second type of seasonal business is open all year round but experiences a peak of activity during a high season. Examples include an accounting firm that experiences more activity during tax season, a restaurant on the boardwalk, or a sports’ goods store specializing in swimming and diving gear. Regardless of the type of industry, these businesses experience higher cash flows in one part of the year and lower cash flows at other times. Applying for a business loan at the beginning of the busy season and paying it back at the end is a very useful strategy. Your goal when applying for a business loan is to have a steady supply of cash flow during abnormally high or low seasons.
  • Prepare for high volume sales and more clients during high season: For instance, food trucks, golf resorts, and swim clubs are busier during the summer months creating an influx of clients. These businesses need more money to compensate for increased costs and must allocate revenue from an upswing in sales to future costs throughout the year.
  • Stock up on inventory: Your inventory balance varies throughout the year but you need to have the most inventory on hand during high season, peak periods. As your inventory depletes, a business loan provides money to keep your inventory levels constant during current and future busy seasons.
  • Pay employees all year round: If you employ a full-time office manager or customer service personnel, you need money to pay them all year. If you had enough revenue to sustain your business during the high season, you could get a business loan during a slow period to cover payroll.
  • Hire seasonal employees: Sales are normally higher during peak seasons like Black Friday, Christmas and other holidays throughout the year. Consequently, you need more staff on hand to help customers. As soon as you take out a business loan, set aside funds to hire help for the peak season. Read this post about hiring employees to brush up on your human resources skills to find the best employees and adhere to hiring regulations.
  • Make upgrades during the off-season: With funds acquired from a business loan, you have money, for example, to upgrade equipment for a fitness center or purchase more gear for your landscaping business. Do you close your business for the winter season? If so, it’s the perfect time to do a makeover in your establishment or to renovate your storefront. When you open your doors at the beginning of the peak season, your customers will be attracted by your new look.
  • Invest in marketing campaigns: Before your business’s high season arrives, it’s important to attract clients. You could outsource your campaign to a marketing company or invest in digital marketing to optimize your website, develop a social marketing strategy, or create content to advertise your product or service. It’s also advantageous to conduct marketing campaigns during slow seasons to keep sales from dropping too low.
  • Invest in technology: Because technology changes so quickly, investing in software upgrades is a must for any business. POS and CRM systems are especially useful for seasonal businesses that expect a high volume of customers. Intranet systems allow your employees to network privately and remotely.
  • Overhead expenses: Expenses like utilities, rent, Internet, insurance and other costs are normally paid each month. A business loan ensures you have adequate funds to pay these costs on time.
  • Pay or renew permits and licenses: Your business can’t operate legally unless permits, business licenses, and other fees are paid. Use business loan proceeds to cover these expenses so you don’t jeopardize your business’s future.
  • Generate income during your off-season: A business loan will guarantee you keep attending the demand for your products and services during the low season, even if it decreases. This way you can still generate an income. A business loan can also help you diversify your products and services once the peak season is over. Remember the ice cream truck? What about converting it into a food truck that sells hot coffee and home-made doughnuts once the summer is over?
  • Unexpected expenses: You must be conveniently prepared for the unexpected. After some months of being unused, your equipment could be rusty. Or your establishment may suffer damages after a tropical storm. In such circumstances, a business loan can help you stay on track.

A Business Loan from Camino Financial Can Help Your Seasonal Business

Camino Financial offers business loans that fit your goals and needs. As a seasonal business owner, you may be interested in a short-term loan, since you can repay this product in a shorter period of time. You can choose a loan term of 24 months or pay your loan in full early if desired with no pre-payment fee. If you apply for a microloan, it’s possible to receive funds in as little as 2-4 days and 10 days for a small business loan. Other attractive features are fixed monthly payments, freedom to use the funds with limited restrictions and a convenient and easy application process. Complete this simple application to get started and work with a business loan specialist to find the best financing option for your seasonal business.

You Can Sustain Your Seasonal Business with a Business Loan

If your business is short on funds, a business loan provides capital when you need it the most. Even if you close your doors during the off-season, you most likely have ongoing expenses for the rest of the year. Therefore, a loan sustains your business when you don’t have a steady stream of income. As a reminder, it’s a good strategy to apply for a business loan before the high season starts or as mentioned above to cover payroll and other expenses. Then, you can sail through each season because there’s always enough money.


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