SEASONAL OR SUSTAINABLE BUSINESS?
Have you ever seen cold drinks or desserts like es kepal milo, orange juice, and everything in the dry season or summer? Soccer jerseys and merchandise during the FIFA World Cup? Or spice and herbs-based drinks like Wedang Jahe during the Covid-19 pandemic? Indeed, you must have seen it, right? Those are some examples of seasonal businesses, the easiest and most effortless businesses, that you can easily find around you.
Image 1 : Es Kepal Milo, a dessert that got viral in a certain period of time
Source : IDN Times, 2022
Image 2 : Soccer jerseys and merchandise store during FIFA World Cup
Source : The Conversation.com, 2022
Image 3 : Wedang Jahe, a herb drink that is commonly known as a healthy drink.
Source : Fimela.com, 2022
Then, try to look at something again around you. Do your toiletries come from Unilever? Does your cereal come from Nestlé or something else? Can you differentiate the second example from the first one? Yep, the difference lies in the primary business types they have. While the first one is seasonal businesses type, the second is sustainable businesses with a long history and operating time. Let’s dive into this topic, shall we?
Image 4 : Unilever toiletries that might you have
Source : Bp-guide.id, 2022
Image 5 : Koko Krunch, healthy cereal for a healthy breakfast
Source : Behance.net, 2022
Know the definition, first…
According to Reference For Business, seasonal businesses are types of businesses that operate in one or two particular situations. The seasonal business itself is a term that refers to the fluctuations in business that correspond to changes in season. The business owner knows very well that their goods and/or services will have a chance to get higher profit in a short time.
Based on a study done by American Demographics, seasonal businesses are businesses that can be predicted easily and give a massive impact that can influence sales directly. If it is possible, the owner at least tries to make the business keep running and produce some money during the remaining months. Otherwise, the owner usually stops their business to reduce the cost of supplies and to avoid paying employees. Weather-related seasons, holiday season, or occasional event-based events can be considered seasonal businesses whose amount of sales indeed change with the season following it.
Meanwhile, sustainable businesses are the capacity and capability of a company for continuing business operations in the long term. It is essential to take note that most sustainable companies embrace the legal, financial, economic, industrial, social, behavioural, and environmental obstacles too. From a business point of view, it can be argued that sustainability is about reducing expenses — including future costs — in all possible forms to facilitate the company’s longevity and competitiveness while also focusing on generating profit safely and sustainably. It is not surprising that a sustainable business can last for years or even decades.
Seasonal business vs sustainable business: advantages and downsides
A seasonal business usually doesn’t require intricate planning and preparations. When you already understand what most people would need to have or consume during a particular season of the year, or you know what is currently going viral around you. When you think of using that moment to start a business, you don’t need to take long to contemplate your plan. When you figure out what, how, and where to sell, you are all set to make big bucks with your seasonal business. In addition to that, you better be quick in executing your seasonal business plan before the season, or the trend comes to an end. As for sustainable business, meticulous planning and thorough preparations are most likely required to ensure the company will sustain itself in the long run. The preparations include searching for partners and investors, hiring permanent employees, deciding on a location for the business to settle, etc.
In terms of capital needs, seasonal businesses require relatively much lower costs than sustainable businesses. Running Halloween and Christmas retailers or selling something currently trending in public, you don’t necessarily need to register your business to obtain some formal license from the government. You won’t need to spend much money on a permanent settlement like you will have to if you start a long-term business such as a restaurant, fashion boutique, or consulting firm. To increase their exposure, sustainable/long-term companies should be willing to invest extra money in advertising, especially digital advertising, either by directly promoting their brands on various internet platforms or by paying a creative agency to manage their marketing strategies.
When it comes to profit, it is hardly possible for seasonal businesses to maintain the stability of their income. Their earnings are seasonal and highly fluctuating. They heavily rely on a single season or trend, and there is no guarantee that they will turn a profit during the remaining time of the year. People would buy Christmas ornaments only in December and need to get themselves Halloween costumes only around October 31st. Seasonal businesses also depend on the demographics of a particular region or country. They can significantly change or, even worse, disappear as soon as the demographics change. As for sustainable/long-term businesses, they try to maintain their profitability all year long amidst changing market situations by taking several courses of action such as reducing manufacturing costs, boosting the company’s productivity, and creating innovations in their brands. Sustainable businesses focus on selling things that they believe people would be willing to buy at any season, things that are essential parts of everyone’s daily life they can’t see themselves living without. Skincare products, instant foods, fitness equipment, and electronics are sample ideas of sustainable businesses that can earn you profit regardless of when you plan to sell them.
Which one is more suitable for you?
As mentioned above, sustainable/long-term business most likely needs you to deal with complicated processes and capital needs. Yet, it is more promising and stable in terms of profit than seasonal business. However, in case this kind of business is not successful with its marketing, it has the potential to cause you a much more significant loss than a seasonal business can generate. So, once you decide to start a long-term business, what you first need to have is a solid commitment to work for its sustainability. You are expected to devote as much time as possible and put your business on top of your priority list. Therefore, it can be said that sustainable/long-term businesses are more suitable for those who currently do not engage in any major activities such as studying at university or working full-time at a company. These kinds of businesses are also more recommended for you to establish in collaboration with some friends and/or relatives. It sure would be more advisable if you could collaborate with those who are ready with their financial capital and willing to support you in bringing your business idea to fruition.
For you high school and university students, part-time employees, freelancers, and literally everyone who wishes to make a mint during a particular season of the year, sustainable business is the answer. You might like to be productive during your summer break by selling ice cream or refreshing drinks at tourist places around you, or if you are good at wrapping gifts, you may start a gift-wrapping business during Valentine’s week or Christmas. For those of you who are keen to spend your money on seasonal or trending stuff, are there any reasons not to try to produce and sell them yourself this time? Well, the seasonal business might not be so reliable as a source of income. Still, if you are mindful and creative enough in responding to seasonal changes and trends, it is worth giving it a try.
In short, which type of business do you want to have experience in? A seasonal business may suit you the most if you don’t have any resources, both in funds and employees. But, if you genuinely want to build a long-lasting company, sustain profit, and have a significant impact on economics and society, you can start small by producing goods/or services that match market needs all the time, not just a certain amount of time. Please remember to make your business core uniquely, not just copy-paste other companies.
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Written By: Muwaffiq Rosyadi & Rosella Veltin
Reference for Business. (n.d.). Seasonal Businesses. Retrieved March 24, 2022, from https://www.referenceforbusiness.com/small/Qu-Sm/Seasonal-Businesses.html
Inc. (n.d.). Seasonal Businesses. Retrieved March 24, 2022, from https://www.inc.com/encyclopedia/seasonal-businesses.html
Scott, J.T. (2010). The Sustainable Business: Introduction. Retrieved March 25, 2022, from https://www.efmdglobal.org/wp-content/uploads/The_Sustainable_Business_fin.pdf
Francis, K. A. (2019, February 25). Long-Term Business Planning. Small Business — Chron.Com. Retrieved March 25, 2022, from https://smallbusiness.chron.com/long-term-business-planning-2544.html
Seither, B. (2017, October 23). Seasonal Business? How To Make Your Peak Time Benefit Your Downtime. Forbes. Retrieved March 24, 2022, from https://www.forbes.com/sites/forbescoachescouncil/2017/10/23/seasonal-business-how-to-make-your-peak-time-benefit-your-downtime/?sh=28747c5d261f
Toray Europe. (n.d.). Long-term Business Prospects (Business Categories and Strategies)| Long-Term Corporate Vision | About Toray | TORAY. Retrieved March 25, 2022, from https://www.toray.eu/aboutus/vision/vis_002.html