How Can A Small Restaurant And Food Specialty Food Store Cope With The Highly Seasonal Sales?

Challenges faced by small businesses with seasonal sales fluctuations

How Can a Small Restaurant and Food Specialty Food Store Cope With the Highly Seasonal Sales?

Most small businesses are challenged to maintain revenues with the fluctuations in market corresponding to slow offseason. Food, tourism and hospitality industry is one of the fields that is subconsciously subjected to business seasons. The seasons are related to weather changes, holidays, and events. Seasonal businesses are relatively subjected to closing their operations during low seasons when the business turnover is relatively low (Shields & Shelleman 2013, p.38).

During the slow business seasons, most businesses implement strategies attempted to ensure the business runs while the expenses are reduced to provide a balance in the cash flow. For example, some company’s may opt to close during the low season while others choose to decrease the number of employees.  Alternatively, some businesses may decide to venture into new activities by expanding their business operations. For instance, tour companies may opt to hire their vehicles or provide taxi services during the low seasons. Considerably. Most businesses during offseason focus on intensive and less costly marketing such as marketing to the local customers.

The case of Big Bottom Market is an example of a business that is faced with the challenge of fluctuations during the low season. The firm has identified options to cope in the slow off-season by getting options from the employees. Additionally, the company has implemented strategies to trim off expenses such as trimming their staff and closed on Monday and Tuesdays, the slowest business days. These ideas were aimed at keeping the business afloat during the low season until the spring, the start of high season. These ideas have their set of advantages and disadvantages as discussed below.

The first idea is to introduce a Big Bottom Market food truck to increase sales and build the brand name in the local area. Investing in food truck will be costly to Big Bottom Market dues to the initial costs of purchasing and refurbishing a food truck. Additionally, the food truck may not be able to access some regions in the areas. However, the investment is advantageous relating to the expected profit turnover. For instance, a food truck will accrue more profits, especially when working in partnership with event organizers that draw large crowds into their events. Additionally, a food truck offers flexibility and less risk to start up and set up compared to a restaurant. Obviously, operating a food truck is less costly since overhead costs are minimized. Contrary to restaurants, food trucks do not require a high number of staff such as cashiers, servers, and hosts (Heo 2013, p.120). Further still, it easier to operate and maintain the truck. Lastly, a food truck can assist in building the company’s brand at a low level and then expand to the broad market in the long-run. The food truck will provide an opportunity for Big Bottom Market to change their brand and image enhanced by the change in locations.

Strategies to maintain balance in cash flow during off-seasons

Second, adding a catering service is a strategy of expanding the company’s brand and image. Catering service is not a daily business since events do not occur on a regular basis. However, the catering service will ensure the restaurant gets exposure in the market while accruing profits. Party planners will be the primary target for the catering services, and with effective marketing, the company will gain revenues to make up for the slow business days.

The third is the idea is to open for dinner. Based on the analysis of the market in the case, the company will get more profits in this idea only if they improve their services and market themselves while highlighting the selling points that customers will prefer rather than opting for the competitors. However, the idea may be less lucrative if the number of dinner customers is lower compared to the expenses incurred in dinner menu preparation.

 Lastly, the company may focus more on marketing to Guerneville residents, and emphasize the Big Bottom Market’s signature biscuits and sell them through a gourmet wholesaler, such as Bi-Rite in San Francisco. This idea may be of marketing to residents will ensure the company gains loyalty to local customers. However, the marketing costs may be costly if the company opts for sales representatives to conduct marketing services. Additionally, selling the signature biscuits through a gourmet wholesaler such as Bi-Rite in San Francisco is likely to result in increased sales and immediate access to the market. The gourmet wholesaler is more familiar in the region, and the prospect of selling new products is high. Additionally, the gourmet wholesaler provides deeper market coverage compared to only selling through Big Bottom Market.

It is recommendable for the company to focus on food truck business and catering services. Food truck business is likely to result in more sales while offering the benefit of building the brand image and name. Considerably, the company may sell the food truck later in the spring when the high season kicks off. Also, focusing on catering services is an alternative idea for the company that is attributed to high costs. Most of the events that focus on catering services such as party planners offer high rates for catering services. Essentially, these two ideas are less costly regarding reduced overhead costs and increased revenues. In conclusion, it is recommended that the company analysis the market intensively and weigh the benefits and disadvantages of each idea to avoid any unprecedented failures.

Case study: Big Bottom Market

Big Bottom Market may consider other options to stay afloat during the slow off-season. The company may offer to adjust the menu and optimize the inventory. The company may optimize the menu by tweaking it to include attractive dishes during the slow season. These dishes will ensure that the restaurant doors are open despite the slow business in low season. For instance, the company may offer local cuisines within the restaurant. However, in optimizing the menu, Big Bottom Market may consider that the do not cut off their signature items such as the biscuits. Besides, the company will optimize the inventory by ensuring that the purchases made are adequate for the low season and thus avoid over purchases. During this season, it is recommendable that the business reduces purchase son highly perishable products. Highly perishable products that may be in excess in the company result in losses. Moreover, highly perishable products are often more expensive and have a short shelf life. It is thus recommendable for the company to tweak the menu to accommodate the fluctuations in the market during the offseason.

Secondly, the company may offer new promotions aimed at increasing sales in the slow offseason. For instance, Big Bottom may focus on promoting alcoholic drinks rather than focusing on foods that have low demand in the season. The business may provide ‘happy hours’ for the alcoholic beverages whereby particular drinks may be served at reduced costs. The promotions should be well planned and offer to attract repeat customers.

Lastly, the business may focus on business development in the offseason. The company may brainstorm on new ideas strategies to attract more customers and increase sales when the peak season arrives. Considering that the peak season is extremely busy hence it’s difficult for the business to get time to plot new marketing and promotional ideas. From this point of reasoning, the company should utilize the offseason to develop new strategies for the incoming peak season and future offseason.

In conclusion, the company can focus on reflecting on the high season. During this low season, the company can concentrate on training and gain new experiences that they will implement during the peak season. For instance, the company may discover new cuisine and offers to be marketing in the peak season.

Social media tool are widely preferred for online marketing both by prominent business and small businesses. Compared to traditional marketing, online marketing is less costly and more efficient for the current online customers. Online marketing ensures business communicate directly and target the relevant audience for their services and products (Stelzner 2013). The Big Bottom Market may opt for various social media tools that suit their preferences and provide a direct target to the existing and potential clients. The business may choose tools such as Instagram, Twitter, LinkedIn, and Facebook.

Big Bottom Market may use Instagram to allow online audience get a visual representation of the business. The company may share the restaurant design photos, dishes, menus, cuisines, table set-up, and the amenities pictures with sharp, attractive look. The company should maintain a steady flow of creative and original visual content to maintain an active Instagram feed to followers.

Secondly, the business may use Twitter. It is necessary for the online marketers to learn and master Twitter tricks and jargons for effective marketing. The users need to learn Twitter jargons and conventions such as hashtags, retweets, direct messages and mentions. The company needs to post original content frequently to increase the business’s online visibility. It is important for the company to maintain keywords related to the market to improve the interactions with similar business and customers.

The third online tool to consider is LinkedIn; the company should set up an official company page on LinkedIn. LinkedIn is the most preferred online tool for professional users who are mainly well-educated and professionals in different industries. The company will benefit from this tool by connecting itself with other potential partners, employees, and businesses.

Lastly, the company will utilize its online presence through Facebook. Facebook offers a wide range network of people to connect and share content. The company will focus on promoting exclusive deals, dishes and offering online promotional campaigns, coupons, and offers. The company will track its visibility through shares and likes on the company’s official page.

References

Heo, C.Y., 2013. Restaurant revenue management. Revenue management for hospitality and tourism. Woodeaton, Oxford: Goodfellow Publishers ltd, pp.118-129.

Shields, J. and Shelleman, J., 2013. Small business seasonality: Characteristics and management. Small Business Institute® Journal, 9(1), pp.37-50.

Stelzner, M.A., 2013. 2013 Social media marketing industry report: How marketers are using social media to grow their businesses. SocialMediaExaminer.com.