So what is the answer for these fluctuations? How does the hospitality industry combat the rise and fall of the tourist season and spread their profits and losses out over the year? The following is a list of ways that you can combat the dreaded off-season:
1. Financial Planning and Budgeting – Peak season will bring in plenty of profit, but when that dries up in the off-season, you need to be prepared. Working with a financial planner who can help you ensure that you have enough profits from the peak season left over to carry you through the off-season is the top way of avoiding the struggle to stay afloat in the dry times. Careful budgeting through both the peak season and the off-season is important, to avoid spending your profits in the peak season and leaving yourselves short of money in the slow time.
2. Off-season Pricing – One way to attract more travelers to your business is to have a varied pricing structure that will offer reduced rates in the off-season. It will lessen the peak season’s activity and increase the business in the off-season, particularly when paired with such things as different marketing strategies. Offering reduced rates in the off season will allow travelers with a lower budget to travel where the peak season prices would hinder them.
3. Appeal to different markets – Another great way to increase business during the off season is to adjust your marketing strategies in order to appeal to a new market. This can include different promotions for different types of travelers, or even promoting group travel. When paired with off-season pricing, group travel for such groups as retirees, or school class trips become much more appealing to those travellers.
4. Closing your Business during the off season – some hospitality businesses find it is more beneficial to them to close their doors for the off-season due to a complete lack of business at that time. Others may find it more beneficial to remain open in the off-season, but offer reduced hours of open time. This would reduce your expenses, but would also still allow business to be conducted, bringing in some money to offset the costs of being open.
5. Create new attractions/Events/Festivals – Consider partnering up with other local businesses to offer promotional packages, or even to create attractions that will benefit all the local businesses. Creating events such as conferences and festivals will bring travelers to your doorstep. Sporting events are one of the biggest draws of travelers to a city, as ticket sales, hotels, restaurants, shopping, and local attractions all benefit.
6. Development – Some hospitality business struggle in the off-season due to their distance from amenities and cities, or their inaccessibility in the off-season. Making your business or attraction more accessible, such as better access to transportation, or more amenities/businesses on site, can help stimulate more business in the down time. Environmental attractions have the potential to be developed also, making them more accessible more often throughout the year.
Seasonality is certainly one of the biggest issues faced by the hospitality industry, but it does not need to become your downfall. Knowing what to expect from each season will help you better prepare yourself for the off-season, and having options to both save you money and increase your revenues can ease the imbalance of peak season versus the off-season. The challenges of staffing and the costs of maintaining your facility in the off-season do not have to be a source of stress, and the benefit to this challenge can be forming new partnerships with others for the benefit of all.