 Coach, welcome back to another episode with my good friend, Andrew Kosal from Valor Accounting Services. Andrew, how are you today? I am very well. I'm here in sunny London. How are you doing? Sunny London, fantastic. I'm very well, very well. So today, Andrew, we're gonna talk about seasonality. All right, so for those coaches, you might not understand what seasonality is. It means external factors that might affect your business. So for example, it could be a weather issue, which limits you to training your clients. A big example we had recently, well, a couple of years ago was COVID, right? COVID shut everything down and it prevented coaches from working in person with their clients. So Andrew, take it away because I know this is something you deal with a lot of coaches on a regular basis. Yeah, brilliant. Thanks, Leo. Definitely, and also other businesses as well. They're not immune to seasonality changes as well. So we're gonna just kind of reiterate what Leo said in terms of what is it? What are the various factors? So the first one is weather conditions. Summer months versus the winter months. Some sports may require certain conditions where it might be milder in the summer months or colder in the winter months. And sometimes the pitch just might not warrant staying on there because the condition is just too bad. Another one would be, is an indoor or an outdoor sport? Even though certain sports may not be affected by weather, they can still have their peak seasons as well. And we're looking at demand as well, demand of the type of sport and the competition schedule as well. So you may have certain leagues or competitions where they are more prominent at sometimes during the year and you would expect the sports coach to be more actively involved during those periods as well. Another one would be, school and university terms, depending on who you're coaching, that may affect you as a sports coach. And to be honest, a lot of these factors do interlink a lot because if it's to do with university times, school times, college times, it's gonna affect the demand as well. Sorry to cut you out Andrew, but all these factors are pretty much talking about cash flow, right? Yeah, exactly. And we'll get onto why these factors can adversely affect your business, but also can create an opportunity for your business as well. Another one is facility availability. Some sports rely on specific venues, facilities to be available. That is also an external factor where you as a sports coach have to be aware of to ensure that the classes still go on and everything's running smoothly. Right, so what does this actually mean for sports coaches? It's basically to do with quiet and busy periods during the year. Now, for some sports coaches, they may just take holidays. It might just be something that they just accept to how it is and they say, look, we're gonna take holidays for X amount of months during the year and that's okay as long as and we'll go onto the cash flow side of it as well, as long as they've managed to save enough to pay themselves during those quiet months and any running costs are covered as well. You may also get certain businesses where sports coaches where they just accept that is how the industry is. Do they think that is there another way to deliver a service during the quiet periods, the less active periods? So we're gonna basically go through that but anything from your side, Leo? Yeah, this is a really interesting topic, especially in our industry because there's certain times in the year and I know from working with especially football coaches that a lot of the business is shut down essentially. Times such as the summer when a lot of parents are away, Christmas is obviously one where everyone's away and there's no one around. So we're gonna get onto it but what can you do in your business to try and prevent these things from happening? You obviously mentioned a couple, make sure you have savings in place for those quieter months or it could be a case of offering other services during those months as well. So yeah, it's a very common one and I wanna give the example and I know we talked about this before we start recording. So on a couple of days ago, I spoke to a foot saw coach, right? So for those that don't know what foot saw is, foot saw is an indoor version of football. Now for the last two years, he'd been running his business using the same score, right? The same score he was using on a consistent basis but he came across a problem which was the hall that they were using, there was a leak, right? So it was just something because it might be because of the weather or it might be just old pipes, who knows? And that facility became unavailable for that coach to then use and that affected his business because he didn't have a plan B. So he lost the whole month's worth of income due to that and not having a plan B and that kind of interlinks with what we are talking about today. Yeah, amazing. And that, you know, it really does bring me along into how does it actually affect, how does seasonality affect your sports culture business? So the first one is cash flow. It means that you're gonna have inconsistent income throughout the year. What do you do then? You know, as you mentioned Leo, have savings during the quiet months and we'll get onto what can be done about it. Another one is purely from a business risk point of view. You are gonna, you are essentially relying on certain times of the year for the majority of your income, sometimes all of it. So what would you do? You book facilities in advance to make sure that they're there. Are there any other unforeseen issues? As you very, you know, quite rightly mentioned, there's gonna be these issues where for a business owner, it's gonna be outsides, you know, our control, you know? How do we kind of mitigate that? Another one is your annual earning potential by its nature is gonna be restricted restricted due to the seasonality. So let's look at what can be done. So in terms of cash flow, ensure you have sufficient savings to cover your taxes in the year. You don't wanna have a situation where you're, you know, you've spoke to your accountant and he said you've got X amount of tax to pay and it's during a quiet period and you haven't saved anything for that. That can be an issue. Cover yearly or monthly costs that are during the quiet periods because some of them you may have to keep them running even if it's quite quiet for your business. Also paying yourself, you've got to live, you know, you've got to pay yourself as an owner, as a business owner as well. So having enough savings is important. Another one is cost management. Where can you reduce costs without risking the quality of service? So these may be things like subscriptions, monthly subscriptions for certain things. There's gonna be things that naturally are just not gonna be involved. Like if you have to travel to certain, you know, facilities, of course, travel costs is not gonna be an issue because you're not gonna be going to them during the quiet periods. You're not gonna be paying for the hire of certain sports facilities. However, having said that, you may be on a, it might be a lease hire, a hire where you're on a contract. So that might be another issue as well. Try to cut costs where you can. Another one is, okay, so the business risk. Look at where the sources of income are coming from. So if you are, you know, going back to the foot sole example, if he had thought of maybe other spaces to hire as a backup, might have been an idea. Book them in, you know, plan ahead of time, of course, that's the first one, but then there are gonna be things outside of your control where is there's a leak, there's damages if the venue is just trying to do a complete revamp, like a development, and it's gonna be closed for the summer, that's gonna be, you know, affecting. And also, that really does come into what we're talking about in terms of demand. There's gonna be a lot of demand in some times during the year where there may be other, you know, events going on. So that'd be another thing as well to look out for. And then annual earning, so this is really the crux of it. This is really where it kind of boils down to is providing additional services. Can you do online coaching, consultation, one-to-one training, sports conditioning during the, you know, off-season, off-season training or pre-season preparation? Obviously, Leo, you can probably give a bit more information on this, because you obviously own your own, you know, sports coaching business. You can take us through a bit more about how it all works. Yeah, no, I think you've given some really good examples. One thing I know a lot of coaches struggle with is when we get to like the summer, groups, right? So if they've been working with groups throughout the year, then when we get to the summer, when a lot of people are away, you know, instead of just kind of giving up with a group because everyone's away, there might be two or three parents that want to continue training because they're not going abroad. So you might look to set up one-to-one training. As we mentioned, you could maybe go online, you know, do Zoom sessions with kids that are still at your academy, but maybe they're abroad. So they continue training with you, right? So yeah, you've given like some great examples and there's a number of things that you can do to kind of limit the risks of seasonality becoming a problem and an issue in your business. Yeah, and you know, just to give a bit more context as well, I had a client who was a taught Zumba, Zumba and conditioning as well and was teaching at a number of different gyms. And what happened was when we were, I was working very closely with this client, still with me, and I realized that there was a major reliance on just two of the gyms. She had a few other ones, but most of the income was coming from, 80% of the income was coming from two gyms. And I mentioned to this client, look, be aware that if one of these gyms do, remove you from the classes for whatever reason, could be they may just wanna stop that class for whatever reason or there could be other factors. Just be aware of that. And what had happened was she started to diversify that and have classes in other gyms to ensure that she wasn't just relying on those two. And what had happened was, lo and behold, one of the gyms actually let her go because they just didn't wanna have that class anymore. They were changing the way they were doing things. And luckily at that time, she had income from other sources, other gyms. Whereas, relatively new business two, three years in, if something like that happened, that could really affect, could really affect the business and maybe could have thought of closing down because essentially about half of the income would have been gone. So definitely something to think about. And I think the whole point of this is building a resilient business and a profitable one, identify risks, ensure that there's reliance. Identify where the reliance is at the facilities, is at the customers, at the clients. You may have specific groups that are completely reliant and that could be your risk. Also opportunities as well, where to invest your time and money and see the trends in the industry as well and working with people to help identify that. Yeah, yeah, love it. Love it, great information Andrew. And going back to your Zumba example, another example in football soccer, especially here in the UK, is a lot of coaches during the winter use a facility called Power League. So Power League's a five-a-side venue that has loads of pitches and sometimes coaches use it for their sessions. But it could be a case where that Power League shuts down for whatever reason, it's going for a bad financial stage, they have to shut down and then that coach in the winter is left with nowhere to train their clients. So again, that's another example. And as you said, just planning ahead, they identify the risks because these things do happen and sometimes it's just out of our control. Yeah, yeah, that's true. So, fantastic, right, Andrew, anything to add? No, that's it for me, Leo. Excellent, all right. Thank you again for jumping on and sharing your knowledge, expertise with us today. It was a pleasure, thank you. See you in the next one. Bye.