The AV business is seasonal. That was true before the pandemic, and it’s true now. But the way we handle the seasonal rhythms of business has changed.

Our Old Business Cycle

In the pre-pandemic days, you’d have six or seven really busy months, and then things would slow down for the rest of the year.

The big thing about the old cycle was that you really counted on the downtime. It wasn’t that you didn’t want the extra business; it was just that if you got it, you’d burn out.

The downtime was your catch-up time. It was the chance for people to take a breather and a well-deserved vacation. It kept crews from getting burned out.

The model unfolded something like this: work like crazy for two months => then have six easier weeks => then work like crazy for two months => then slow down for six weeks. Everyone on your team needed that down cycle to recover.

We rationalized this cycle by saying (yes, I said this, too) that we used the slow periods to catch up on internal projects. You’d save up internal projects — training, maintenance, organization — and set money aside so you could take care of them during the slow months, making that time as productive as possible.

It was our financial coping mechanism for dealing with downtime.

How the Cycle Has Changed

While there’s still seasonality in the AV business, it’s changed.

2022 held a fairly steady period of demand because we were coming out of pandemic restrictions and limitations. But that’s not normal.

As predicted, 2023 is the first normal post-pandemic year. We’re seeing the familiar peaks and valleys of seasonality return — and that’s fine. Live event production is always going to be a seasonal business.

The natural tendency is for owners to return to their old methodology where they’re fully staffed for the busy months, and then using all those extra people for internal projects in the slow months. That’s what they’re used to. It’s habit.

The first problem with this is, what happens if you never get slow? Or at least, you never get as slow as before?

But, more importantly, we also need to talk about scalability.

Make Seasonality Scalable

Both then and now, internal projects are important. They’re not optional. What’s changed are the internal resources you have available to get them done.

With the standard model, you use inside direct costs to finance these internal projects during slow periods. But if you’re working toward a scalable model, then you’re striving for less overhead expense and fewer direct costs on staff. You’re aiming to run a smaller core team that works exclusively on selling, planning, and procuring.

And that team is always busy.

In a scalable business, planning projects and events for customers happens year-round. You may not be on a show site every day, but your core planners wouldn’t go to a job site anyway. They’re always working on the next show, and they’re always working ahead. If they need to take a vacation, they work further ahead, and someone else duplicates their efforts while they’re out.

These core jobs are year-round, but they’re not the same intensity as the old seasonal versions of the same jobs.

For instance, if I’m in the old seasonal job of buying supplies, ordering rental equipment, and planning equipment flow logistics, I’m swamped during the busy season and working 70-hour weeks. I’m really looking forward to some downtime so I can take a vacation. And if I don’t get it, I’ll burn out.

When the same job is a core position, I’m working a normal 40-hour week regardless of the time of year — because this is all I do. I’m not running to external sites. I’m not prepping shows in the warehouse. I’m not making deliveries. I’m simply working as far ahead as I can during my 40-hour week, and I do it all year (minus vacations).

So in a scalable business, you don’t have extra people lying around, even in slow times. You have smaller, core teams, and they’re always busy. The way you handle the seasonal rhythms of your business has changed. If you don’t reframe, you’ll never have the time or capacity for internal projects.

What do you do? Treat internal projects like external projects — outsource.

The Mindshift

If you want to stay scalable AND get internal projects done, you have to utilize your workforce differently than before. This is a mindset shift away from how things ran in the old seasonal cycle.

Internal projects are essential and have to become part of your business plan. But your core team is always busy, so who’s going to carry them out?

In the scalable model, you execute internal projects with external people — just like you do for your customers. If, for instance, you need to reorganize your warehouse, you hire outside people, supervise them, and get the project done. You treat it as if it’s a show.

How to Build Success in the New Normal

If you’re after intentional success in the new normal, scalability is the key. That’s a new reality. You must face it head-on.

To do so, remember the five cardinal rules of scalability:

1. Understand that scalability is a top priority
2. Keep overhead low
3. Manage capacity
4. Turn away non-ideal work
5. Better understand job costs (and KPIs)

These are the rules. They’re guideposts. If you need to figure out how to get internal projects done, as long as your solution falls within the rules of scalability, you’re golden.

So if you need to get a project done, scalability means you’re not going to hire more permanent people to do it. You’re not going to create excess capacity for projects. That takes care of rules 1, 2, and 3.

To follow rule 4, you’re going to turn away non-ideal work, which means there will be some gaps in your calendar — on the order of a few days, not a few weeks. These small windows of opportunity give you space for internal projects.

Then you spend the money it takes to get the project done. What will it cost to move a wall in your building, or do a deep QC on products, or repaint whatever it is that needs to be repainted? That’s what the job actually costs.

Finally, get quotes and create budgets for your internal projects — because you’re going to outsource. That takes care of rule 5.

Conclusion

In the old seasonal cycle, you rationalized that internal projects were free if you did them in-house.

Outsourcing may feel like more money, because the internal projects you did during downtime in the old cycle felt free. But they never were. You were simply using your excess, overspent resources to execute them.

The overspending on those resources far exceeded the cost of just outsourcing the project.

Internal projects cost money. To stay scalable, spend that money on external resources that won’t balloon your overhead and torpedo your profits.