The Pros and Cons of Hibernating Your Business
Should I hibernate for the winter? There are potential reasons why this could be a good solution, but first, you need to weigh the pros and cons.
Pro – Money
This is probably the biggest factor that determines many businesses actions moving forwards regardless of the situation. Revenue pays the bills, wages and other expenses so owners will do anything within reason to secure their profits, existing clients and revenue streams. The furlough scheme currently put into place still requires many owners to pay forwards for half of their teams’ wages, covering the rest with the scheme.
If an owner decides to run a relatively smaller operation during the winter months it could help with the costs moving forward, but that may not rest well for a team willing to work through the winter. This brings us to a con.
Con – Loss of recurring business
Whilst there will be owners that decide to shut up shop now until March, there will be those who open their doors throughout the season. Placing your business into hibernation could lead to recurring customers looking elsewhere to fulfil their needs. The lack of work will be frustrating for any owner and their team. Sooner or later your team will question their place within the company or seek employment elsewhere.
This doesn’t mean businesses shouldn’t comply with any government restrictions when they occur. If a city is under lockdown procedures they should seek to pivot their business and not carry on regardless at the risk of the team’s health and a hefty fine.
Pro – Time to Prepare
Not worrying about continuing to run a business at full capacity leaves the time to strategise. Owners can take the time to refine their marketing, offering, sales process and more in preparation for next year. Just because a business is “hibernating during the winter” doesn’t mean it needs to slow down to a halt. Turn the experience into a quick regrouping opportunity.
Con – Uncertainty
When a business doesn’t appear to be moving forwards it can lay an air of uncertainty around the office. Investors, clients and the team can start to whisper if you don’t have constant reassuring communication. But, as with many things, overdoing it can cause more harm than good. It’s one of the annoying sweet spots that lie between you need to find. This uncertainty can cause faith to be lost in the owners, the managers and those communicating with the rest of the world. If you do choose to close business and hibernate for the winter, ensure your communication is flawless.
When deciding if you should hibernate your business you need to consider a few things:
- Will the business survive the hibernation?
- Is it a good idea given your current industry?
- What will your business look like coming out of hibernation?
Remember closing a business is a decision that doesn’t just affect a business, but everyone around the business. Most importantly the owner themselves as they will need to use this time wisely. There is no rest. Only regroup.