My business revenues fluctuate dramatically.

How can my business produce a more consistent revenue stream?

For many businesses the revenue yo-yo is a constant challenge. Many live to accept this as just the normal state of how business fluctuates. For some it’s impacted by seasonal business flows. For others it’s related to an inconsistent marketing effort – push harder and results happen; stop pushing and revenues suffer. Regardless, when your fixed expenses are generally constant but your revenues go up and down, it is both inefficient and emotionally challenging to see your net margins constantly oscillating, perhaps even dipping below zero at times, needing out-of-pocket cash injections or seasonal external funding to sustain the business.

And you may be thinking that there’s not that much you can do about it. It's the business I’m in. Or this is how this particular line of business runs so I have to go with the flow. Well, you couldn’t be more wrong.

In most cases, seasonal businesses and those impacted by varying external factors can smooth out their revenue flows with a few simple processes. The solution lies in adjacent accretive offers. So what exactly is that?

Let’s for example take a seasonal food service business which enjoys high attendance in the spring, summer and autumn months, but falls off drastically in the winter. You can reduce your staff costs over the winter, but your rent is still due each month, so during winter you’ve been dipping into your cash reserves to keep the business afloat. An accretive offer in this scenario might be to develop a strong take-out menu, including winter seasonal favorites and perhaps even holiday special dishes and reprofile your operation to run a lean and mean food delivery service. Between UberEats, GrubHub, DoorDash and others, you can contract the delivery and focus your kitchen on producing the best dishes in town and great reviews which will inevitably follows. And the additional benefit is that, as spring approaches, some of the delivery process can be retained to overlay on top of your excellent seasonal in-restaurant dining revenues. Next winter season – rinse and repeat.

In another example, a lawn care business again might suffer a complete fall off of revenues during the winter months. An adjacent accretive option for this type of business might be to offer indoor plant care for households, tree trimming services, snow removal or other services specific to the environment which might be in demand in the off-season months.

For every variable business, with a little creativity and innovation, an adjacent accretive revenue model can usually be developed. And in many cases, that ancillary off-peak revenue stream can be partially, or sometimes fully sustained and added onto base revenues during the peak business times, creating a recurring growth model for revenues as each year you build on top of the performance from the last.

If your business is in the fluctuating revenues predicament associated with a variable business, please come talk to us. We will dive deep into your operating model and very likely come up with a strategy and plan to mitigate this uncomfortable financial performance hurdle and help you accelerate your business.