Most, if not all, companies are affected by external factors. External factors can include the price of gasoline, the weather, and events happening around the world. If you own a business whose sales increase and decrease with the seasons, you know how tough this can be. There are many reasons why a business thrives in one season of the year and not another. They could be directly affected by weather, such as a ski resort or construction company financing business, or they could simply be located in a tourist town. Here are four industries that are affected by seasonal sales.
1. Hotels and Restaurants
Hotels located in certain regions of the country are greatly affected by seasonal sales. Many businesses in coastal New England, for example, reduce their hours or close altogether during the slow winter months. As a result, hotels and other businesses that serve tourists make much less money during these times. A consequence of this is accommodations having to raise their prices for half the year and greatly lower them for the other half. Similarly, restaurants and fast food locations that are popular with travelers see a decline in sales as local tourism wanes.
One of the main reasons for construction being a seasonal industry is that in many parts of the United States, it is not feasible to build during the winter. When the ground is frozen, it is much more difficult to build and place the foundation for a building. Another reason is that people simply relocate less during the summer, partly due to school schedules. People who specialize in construction company financing keep these reasons in mind when talking to those in the construction industry.
3. Tax Preparation
While many accounting firms operate year-round, businesses that focus on tax preparation are mainly only open in the months before taxes are due, which is mid-April in the United States. During the off-seasons, these services may operate on an appointment basis or may close for good, with the employees working for similar industries during this time.
4. Sports Teams
Most sports are played seasonally. For example, professional football sees its heyday in the fall and early winter months. Many temporary employees work for college and professional sports teams during their season, or when that particular sport has a large number of viewers.
If you own or finance a business in one of these industries, seasonal sales may affect your profits.