Businesses try to even out ups and downs

When Kathy Donnel and Mary Schubert aren’t making baskets, they’re marketing baskets.

Living by this mantra helps the owners of A Bolder Basket Kase in Boulder grow their small business even when orders are slow to come in.

“You have to be accepting of slow and fast times,” Donnel said. “Slow times can be productive. Those times are out of our control to an extent, but we work to take back control and discover how we can make the slower times busier.”

Donnel and Schubert did exactly that with their Tax Day Survival Basket. They took an existing occasion like tax season and used it to make their customers stand out by developing a basket for banks to thank their CPAs. The idea was a huge success.

For retail shops in downtown Boulder, continuing to draw customers outside of the holiday and tourist seasons can be challenging. Seth Rowland takes advantage of the slow times he experiences to drastically change his store displays. The owner of Happenstance Books & Curiosities finds that changing things around tends to pull people in. Rowland also sells his items on the Internet to help supplement his income when business in the store is slow. He has found that people tend to purchase throughout the year online.

But even online businesses experience ups and downs. Aspen Grove Market, a new online grocery store based in Boulder, sees business slow down on the weekends and holidays.

“Seasonality or fluctuations in business are difficult to manage,´ said Brian Chrisman, president. “We would like to even out as much as possible.”

To do so, they are exploring different ways to get people to purchase more during those slower periods, such as offering special sales that might happen right before a weekend and offering products that are holiday specific.

Eric Skokan knew business at Hatton Creamery, an organic ice cream shop in Boulder, would be seasonal, so he added cafe offerings of homemade soups, salads and hot sandwiches, hoping it would “lift business to an acceptable level in winter.”

“Our goal is to have relatively stable revenues throughout the year,” he said. “It makes life easier in terms of scheduling and planning what you will need for the future.”

So far, his concept is working. This past winter non-ice-cream sales were two-thirds of his revenue base, while this summer ice cream is three-quarters of the base. They’ve basically flipped, which is great, he said. By keeping the revenue levels even, he has been able to keep mostly the same staff, which has been a welcome surprise.

While many small-business owners put the slow times to work for them and try to increase sales, others find smart financial planning is the key to bringing them through lean times.

Cynthia Marshall, owner of The Better Back Store in Boulder, uses business credit cards to aid cash flow. She said using her credit efficiently is very important. When Marshall orders from vendors, she will have 60 days between the time she orders and the time her credit card bill is due. This gives her enough time to turn over merchandise and pay her bills. It also speeds the ordering process.

Vendors already have her credit card number on file so there is no checking her account, which means products ship sooner and her customers receive their special order products more quickly. Plus, every time Marshall uses her credit cards she earns points to use for business travel or receives cash back on her purchases.

While fall tends to be the busiest, Marshall finds that her business is pretty steady through the rest of the year. However, Lynne Milot sees 50 percent of her sales for Grandrabbit’s Toy Shoppe from September through December, with a big chunk earned in December. Early on the toy store’s founder and owner would hold sales to help during the first half of the year. Now Milot, who has stores in Boulder and Superior, has found a balance between the slow and busier times and uses the money she earns during the holiday season to cover the lean times. She also relies on a line of credit if she needs to make large purchases during the slow periods.

Just as it is for Milot, careful planning is important to most small businesses. The owners of Amante Coffee have taken it to a new level.

The management of Amante Coffee relies on a highly quantitative system to stay cost efficient and improve the bottom line. The process for ordering sandwiches is one example of this system. They contract out for all of their sandwiches and have a standing week by week, day by day order for each sandwich. The ordering system relies on the time that they sold out of the sandwich during the previous three weeks.

General Manager Justin Rosenthal said such careful tracking systems help Amante control costs and thereby keep the business viable. They evaluate these systems often to ensure efficiency.

Not only must small businesses be creative and careful on the product side, they must also be efficient in staffing.
Rosenthal uses a similar system for staffing as he does for food. Amante’s staffing model varies by hour and by day. Each hour and each day has a different model and a characteristic curve. Rosenthal said they adjust staffing weekly based on the previous four weeks of business. Then, when the cafe is not busy, employees have assigned duties to complete to keep the cafes in two Boulder locations running in top shape.

“The key is to maintain efficiency,” Rosenthal said. “We cannot staff the store with fewer than two people, which isn’t always efficient. To keep those two people efficient, we use that labor to complete projects.”

Skokan has a similar philosophy. He said his employees multitask across a shift, and when business levels drop off, they do prep and organization projects. Everything in Skokan’s store is homemade, so during down times, employees work on preparing the food.

“In order to make business efficient, it takes a lot of tweaking of scheduling and training,” Skokan said. “I tend to like a small number of people who can wear lots of hats. I invest in my employees in terms of training.”

Marshall controls her labor costs by hiring a flexible staff. The hours Marshall’s employees work vary based on the volume of business she has. Marshall laid out the fluctuation in hours right upfront.
“When it comes to dealing with fast and slow periods, it is wonderful to have a staff that is flexible,” she said.

Donnel and Schubert also believe flexibility is key. They rely on an on-call staff as well as outside hires, such as couriers, to help when the work is too overwhelming for them.

At Aspen Grove Market, cross-training employees has proven to be very important in meeting the challenges slow periods present, especially to a startup. By cross-training staff members, Chrisman said they are able to trim their staff on holidays and weekends, and save on labor costs.

“As a startup, it is real critical for us to weather through all the ups and downs,” Chrisman said.

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