Along the Ohio River Road in Lesage, West Virginia, sits Hillbilly Hot Dogs, a destination stop for locals and tourists alike.
When winter hits, however, Hillbilly’s popular—and wildly distinctive—weenie stand sees a sharp, double-digit decline in revenue, says Sharie Knight, who opened the self-deprecating eatery with her husband, Sonny, in 1999. The sales drop is tough on the business, demanding ownership make some shrewd, strategic decisions to ensure the restaurant meets its annual financial targets.
“You really have to store your nuts,” Knight says.
While all restaurants tend to ebb and flow throughout the year, some seasonal shifts deliver wider fluctuations than others. From harsh winters and the college academic calendar to sports seasons and tourism spikes, quick serves with a seasonal slant face sensitivity to both profits and losses.
“Seasonal operations have to be on their game or the restaurant can quickly become a no-win business,” says Ray Esposito of LP Innovations, a Massachusetts-based loss prevention firm.
While the basics remain the same around the calendar year—providing tasty food and quick, friendly service—Esposito says seasonal locations require extra flexibility to address the drastic swings.
“Seasonal businesses have to constantly flex their behavior to match what is particularly critical for the current season,” he says. “If they don’t, the business will never reach its potential.”
Tourists come and tourists go
A Myrtle Beach, South Carolina, landmark since 1937, Peaches Corner has seen the ups and downs of seasonal business for longer than most of its customers have been alive. While Myrtle Beach has fewer than 30,000 permanent residents, according to the Myrtle Beach Area Chamber of Commerce, the city and its surrounding area welcomes about 15.2 million tourists each year, the vast majority of them visiting from June through August.
In summer’s three-month run, Peaches captures more than two-thirds of its annual revenue, with six to seven employees working each of the restaurant’s two shifts. Come winter, Peaches general manager Briggs Dickerson says, weekday sales might be 5–10 percent of what they are during an active summer day, and one manager runs the entire 55-seat operation.
During the down season in such heavy tourist locales, many shops reduce their hours or even shut their doors, content to cut their losses. In Nantucket, Massachusetts, Nathan Coe closes his Nantucket Pasty Co. from October through March and turns attention to off-island opportunities, such as retail and wholesale accounts.
“That’s our way of countering the drop-off,” Coe says.
For much of its history, Peaches followed a similar format, closing at October’s end and reopening in March. Eunice Burroughs, Peaches’ late matriarch, used to tell Dickerson he had three months to make money. “‘Come winter,’ she told me, ‘you could lay down in the middle of Ocean Boulevard and not get hit by a car,’” Dickerson says.
To that end, Dickerson has worked to fully maximize the high season’s potential. He teamed with other local businesses to form the Oceanfront Merchants Association (oma) to entice tourists to visit and stay in Myrtle Beach rather than fleeing to adjacent communities, such as North Myrtle Beach or Surfside Beach. The OMA’s “Hot Summer Nights” campaign includes a Monday night kids’ carnival, Wednesday fireworks, and an oceanfront concert series.
“This draws people to the downtown area so we can all capitalize on the summer influx,” Dickerson says. “Strike when the iron is hot, right?”
But Dickerson has reprioritized the offseason, placing Peaches on a year-round calendar to keep valued staff involved and capitalize on some offseason opportunities, such as holiday traffic and spring break. The eatery woos locals with hot dog and burger specials and an increased social media presence, reminding them that the town belongs to them, not the tourists, in the offseason.
“We don’t get rich, but it puts a few extra dollars in our pocket,” Dickerson says of the offseason. “We have to play our cards right, but the rewards are worth the risks.”
Dickerson tries to consistently think big picture. Given the cyclical nature of his business, he says, he monitors the budget, staffing, and purchasing on an ongoing basis, not just during winter’s freeze.
“Sound business management is a year-round thing, not just when the sales and traffic are down,” Dickerson says.
Class is in session
In Bloomington, Indiana, the 82,000-resident town that hosts Indiana University (IU) and its 42,000 students, the Bloomington Bagel Company is an institution. During the school year, the Bloomington Bagel Company’s three area locations—all of which are located within a mile of the IU campus—are rocking. The stores enjoy steady streams of customers and daily deliveries to the university’s Greek houses and campus buildings.
Come June and July, however, summertime silence replaces the school year’s surge. CEO Dawn Keough says revenue drops about 30 percent across the Bloomington Bagel system.
Disconcerting as the decline can be, Bloomington Bagel leadership chooses to take the downtime in stride, viewing the summer season as an opportunity to regroup, refocus, and recharge.
“It’s valuable for us to get a break and breath of fresh air, too, and I think the work we actually accomplish in the summer drives our success,” Keough says.
Though Bloomington Bagel cuts its labor needs in half during the summer, the company keeps its in-town employees involved. Management cross-trains staff and filters them to annual business tasks, such as cleaning or organizing.
Some of the company’s employees also enjoy summer internships in Bloomington Bagel’s operations or marketing departments, a relationship that grants the employees important real-world experience and provides Bloomington Bagel leaders fresh, often unfiltered perspective.
“We really want to focus on maximizing the potential of our staff and taking the time to prepare for the influx we will see when school returns,” Keough says.
Bloomington Bagel also uses the summer to re-engage with local residents. The company hosts facility tours for schools and camps and connects with summer shows at the IU Auditorium, frequently dishing out promotional “wooden nickels” that entitle guests to a free plain bagel or $1 off their next visit.
“The idea is to maximize our exposure in the community at a time when the students aren’t around,” Keough says.
At the McAlister’s Deli location just off the University of Alabama’s campus in Tuscaloosa, area director Jerry Jones says, finding opportunities that are less tied to the academic year are critical for a store that, like Bloomington Bagel, sees its revenue drop about 30 percent in the summer months.
To fill the gap, Jones and his McAlister’s team find catering opportunities for groups coming to town, such as softball tournaments or aquatic events. The franchise also leverages its relationships with the chamber of commerce, local parks department, sports camps, and student orientations at the university to propel sales.
“Because of the student migration, we need to have our eyes on subsidizing what we’re losing and be proactive about making up the difference,” Jones says.
At weather’s mercy
In all six of Mike Geiger’s Pittsburgh-area Moe’s Southwest Grill locations, traffic slows after January 1.
“Mark it on the calendar,” the Moe’s franchisee says.
Last winter, the lull intensified as the headline-grabbing Polar Vortex brought sub-zero temperatures to Pittsburgh. Roads emptied, offices closed, and the city went on lockdown, further complicating Geiger’s traditional winter slog.
Rather than accept that bitter pill, Geiger and his team flexed their marketing muscles. Amid -9 F temperatures on January 7, Geiger’s shops unveiled a Brrrrrito promotion, offering $2 burritos to customers via social media and text message. Lines formed out the door at Moe’s, and Geiger’s registers rang all day. “We were going to make people leave their houses,” Geiger says.
The Brrrrrito promotion aside, Geiger makes a concerted effort in the opening 10 weeks of each calendar year—easily his stores’ slowest period—to protect the bottom line. To offset the winter season’s in-store traffic declines, Geiger’s dedicated sales force pushes catering opportunities, and his stores host team nights for local schools.
“I understand things drop off, so we learn and we augment, and we offer strategic and pointed promotional opportunities,” Geiger says.
He also leans on a historical log tracking nine years’ worth of sales trends at his Moe’s locations. “Seeing the peaks and valleys helps us plan for the future,” he says.
Geiger’s concentrated wintertime efforts have delivered results. Rather then the 20–25 percent revenue drop in January and February his stores endured in their earliest years, winter sales now vary less than 10 percent from his stores’ annual highs.
“That’s a falloff much easier to digest,” Geiger says.
Hillbilly Hot Dogs also prepares for its inevitable winter slowdown with a mix of clever marketing and strategic management. The restaurant introduces winter-only, belly-warming menu items, such as chili, goulash, and homemade soups, while the Knights focus on what they can control to maximize their prime season: repairing the “weenie stand”—the original location, which is made up of a shack, old school bus, and other spare parts—ordering souvenirs, and readying marketing plans.
Fortunately, the Knights also stumbled upon another way to counter the winter decline that annually rattles their Lesage unit: They opened a second store in Huntington, West Virginia, adjacent to 14,000-student Marshall University. When the Lesage store slows, the Huntington spot teems with students and university staff; when winter weather makes driving to the Lesage store difficult, the Huntington spot corrals pedestrian traffic. When students head home for the summer, Hillbilly Hot Dogs’ weenie stand in Lesage is at its peak with hot dog–loving tourists and locals. The strengths of one unit balance the weaknesses of the other.
“These two play off each other extremely well,” Knight says.
During the New Orleans Pelicans basketball season, Smoothie King’s unit inside the aptly named Smoothie King Center is open for 10–20 events each month. Many of those events attract more than 14,000 attendees, and Smoothie King sells an average of 500 smoothies per event, says Chris Webb, Smoothie King’s director of company store operations.
But when the NBA season ends, traffic in the Smoothie King Center falls. The arena might only host two to four events in the NBA offseason, with the arena’s Smoothie King unit averaging about 175 smoothie sales per event.
The discrepancy between the highs and lows makes handling labor an immense challenge, Webb says, echoing the concerns of many seasonal quick serves. During each basketball game, for instance, Webb needs eight to 10 staff members willing to commit to shorter three-to-five-hour workdays, a difficult task that he addresses by pulling assistance from Smoothie King’s local corporate and franchise community.
The inconsistent sports schedule also makes product logistics and rotation a challenge, one that has since been multiplied with the addition of a Smoothie King unit inside the adjacent Mercedes-Benz Superdome, home of the NFL’s Saints. Week to week and month to month, Webb’s team has to project and anticipate product needs on a per-event basis.
“This is different from our traditional locations that have definite product needs and rotation,” Webb says.
So much of the battle is preparation, Bloomington Bagel’s Keough says. On football game days at Indiana University, it’s “all hands on deck” at the Bloomington Bagel Company, she says. The stores begin ramping up production on Wednesday, filling their walk-ins with ready-to-bake bagels.
“It’s a roller coaster and, come early Saturday morning, we’re baking all day,” Keough says.
For some, the impact of a sports season can be felt well beyond game day. While football Saturdays at the University of Alabama are slow at McAlister’s Tuscaloosa location, that’s not the case on the Fridays and Sundays that bookend home games at the 101,821-seat Bryant-Denny Stadium.
“Our numbers on those two days will jump 25 percent,” Jones says, though he admits the opponent can significantly sway that figure. For a cupcake opponent, the jump might be minimal; for the annual Iron Bowl against rival Auburn, it’s “no holds barred,” Jones says.
The key, Jones says, is careful documentation that includes key details, such as the opponent and game time. If Jones anticipates a spike, the store will increase its labor, including kitchen prep staff on Thursday.
“These detailed records give us a knowledge base we can refer to,” Jones says. “We can’t just look at the first Saturday in October from one year to the next. If we do that during football season, we’re asking for trouble.”