I run a self-funded eCommerce business. How do I manage slow seasons?’

When sales slow down and new customers are harder to reach, it can feel like your business is on its last legs. But the reality is that seasonality – with heady highs and frustrating lows – is simply part of running a modern business. This is especially true for eCommerce operations. The good news is that more than 5.6 million Australian households shop online every month – so there’s certainly an appetite for it. Adelaide’s Kimberley Gifford is one of many entrepreneurs who has to deal with the fluctuations of sales periods, with her eCommerce business, Diminish. Gifford asked Kochie’s Business Builders’ Small Business Help Desk initiative a question: “As a self-funded small eCommerce business owner, how do I manage cash flow when sales are slow and bills need to be paid?”

Small Business Help Desk: A cashflow question

Driven by an entrepreneurial spirit and a desire to make a positive impact on the planet, Gifford jumped into the rapidly rising eco-products market after running a photography business. With environmental responsibility a core belief among most generations – but especially millennials and Gen Z who live and breathe the internet – she spotted an opportunity to set up her own eCommerce store for high-quality sustainable, vegan and natural products. Enter Diminish, Adelaide’s largest online eco-friendly store. “I had two little kids at the time Diminish began in 2021, and I thought I’d start an online store that I could run from home,” Gifford says. “I started with about 50 products that I’d sourced from Australian suppliers, especially local South Australian brands, and I was careful to only select products that aligned with the Diminish values of sustainable, compassionate and ethical living.” While the business is still going strong more three years after opening its virtual doors, Gifford says it hasn’t always been smooth sailing. “The business is completely self-funded. There’s obviously the hope that it will continue to grow, but I don’t have all the skills necessary to get where I need to go. So then I get stuck on, ‘All right, if I invest in some advertising, then sales will grow.’ But I don’t have that money to invest in the sales or the skills to know how to get there cost-effectively. All I know is what I’ve learned over the years, which is more the technical side of things.” It’s no easy feat, but there are ways to keep productive during slower moments, a financial adviser tells us.

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Small Business Help Desk: Tips from a financial adviser

Glen Hare, financial adviser at Fox & Hare, speaks to small business owners all the time about cash flow. The Sydney-based founder says that limited access to capital is one of the major challenges for self-funded businesses and entrepreneurs. “Bootstrapping means relying on personal savings or credit, which can restrict growth and make weathering slow seasons difficult,” he shares. Two more struggles that Hare hears regularly from clients are their cash flow management woes, and having unpredictable income year-round. “Cash flow management requires the balancing of day-to-day expenses with fluctuating sales, which can be tricky, especially during slow periods. Then there’s unpredictable income – without a steady stream of revenue, budgeting and financial planning become more challenging.” Decreased sales and revenue can be a huge drain on both your mental health and your willingness to push through the seasonal troughs. “This is the most immediate and impactful challenge,” Hare adds. “With fewer products moving off the shelves, businesses experience a cash flow shortfall. This can make it difficult to meet financial obligations like rent, payroll and loan payments.”

Strategies for making the most of slow seasons

So, what’s the solution? While the exact strategy to deploy will depend on your business type, size, industry and financial resources, Hare suggests a few back-office and creative tactics that can make your day-to-day more productive, and your operations more sustainable:

• Reduce expenses: “Review your budget and identify areas to cut back. This could involve renegotiating contracts with vendors, delaying non-essential purchases or offering temporary staff incentives in exchange for reduced hours.”
• Boost sales (creatively): “Consider offering off-season discounts, promotions or bundled packages to incentivise purchases. Explore new marketing channels to reach potential customers who might not be aware of your business.”
• Focus on customer retention: “Engage your existing customer base with loyalty programs, exclusive offers or educational content. Retain satisfied customers who are more likely to return during peak seasons.”
• Improve operations: “Analyse data, streamline processes and identify areas for improvement. This can lead to increased efficiency and cost savings down the line.”
• Develop new products/services: “Research and brainstorm new offerings that cater to different needs or expand your market reach. This sets you up for future growth.”

While you may not have the funds to invest directly into online advertising or social media campaigns, by allocating your resources to other essential tasks you’ll be able to bolster your business while waiting out the slow season. Do you have tips about riding out slow seasons in business? Share with us in the comments below.

This article is brought to you by Kochie’s Business Builders in partnership with NRMA Small Business Insurance.