How to Keep Your Restaurant Thriving in the Offseason
Many restaurants will face some sort of offseason, a predictable time when business drops off for weeks or months. Whether it’s because the tourists have gone home or the chilly weather is keeping customers away, these slow periods can hurt your restaurant’s bottom line.
Surviving and even thriving during the low season is possible, but it’s more difficult if you just try to wing it. Use these strategies to plan ahead and keep your business humming, even when it’s not full.
Always set aside savings
It’s far easier to survive slow periods if you prepare for them by saving year-round. Aim to set aside a percentage of your restaurant’s income every week or month, and stockpile it in an interest-earning savings account. Then, if you’re struggling to break even in the offseason, you’ll have that cash handy to help you get through it.
Make necessary cuts
If you anticipate that money will get tight, it may be prudent to make some cuts to reduce operating costs during your low season. One tactic is to temporarily remove items from your menu to curtail the amount of ingredients — particularly perishable ones — you have to purchase. Just make sure not to remove any signature items that would cause regulars to stop coming. Also consider temporarily reducing staffing and even hours to accommodate a slower business season.
Use smart financing methods
If your cost-cutting and rainy day fund aren’t enough, consider obtaining some form of small-business financing. While merchant cash advances are popular in the restaurant industry, they can be extremely expensive. Loans may be a better bet, but traditional loans through the U.S. Small Business Administration are difficult to qualify for and take months. Not sure how to get a business loan? There are numerous online alternative lenders, such as Kabbage, OnDeck, Funding Circle and Lending Club, that offer quicker and more easily obtainable loans and lines of credit (though they can be pricey if your credit isn’t great). Credit cards can be another way to survive the offseason, but try not to land in a spiral of debt that you can’t get out of.
Stay active online
Your customers use social media all year, so continue using Facebook, Twitter, Instagram and any other accounts to promote your business and build excitement about the next season. Use these outlets to share upcoming specials, enticing photos and videos, customer testimonials, polls and even contests to retain customer interest. While you’re at it, why not try email marketing and blogging, too?
Get smart with marketing
Try new marketing tactics to boost business. If tourists are your regular customers, why not begin to market your restaurant to locals? This is also a great time to experiment with specials. If you don’t offer a happy hour, consider starting one to lure in budget-minded guests during the offseason. If your bar or eatery already has a happy hour, you could try promoting fresh food and drink specials to bring in new faces. It’s even better if you can start promoting these new specials before the slow season hits in an effort to keep interest high. Get creative and think of other events or services you could offer for extra income, like cooking classes, food delivery or selling specialty foods.
If you’re out of options, close temporarily
If you’re hemorrhaging money by trying to keep your operation running during low season, it may be best to close for several weeks or even a few months. While you won’t make money during this time, at least you might be able to stop the bleeding. If no income is not an option, consider offering catering and private events during this time.
Emily Starbuck Crone is a staff writer at NerdWallet, which provides clarity around decisions that help you start or grow your small business. We provide clear unbiased information, entrepreneur-focused advice, and tools for small-business loans, tax and legal issues. We also connect you with experts who can answer questions about growing your small business.