Okay, so let’s talk camp…..cash-flow.
Here we are on the back side of summer rapidly heading into fall. For most camps, this also means the back side of their revenue peak as we head into the “off” or “slow” season. This is the time when pennies are pinched, budgets are watched and directors wonder how they are going to make it until registration opens back up.
The good news is that there are strategies to help relieve the stress of seasonal cash flows. Here are some suggestions as you begin to “winterize” your grounds and start planning for the next season.
– Open registration for the next year earlier. I had the pleasure of speaking with Tarryn Rozen of Camp Susquehannock and this is a strategy that they implement. Their goal is to open registration in the first week of September and offer tiered “Early Bird” discounts; 10% discount if registered by October 31 and a 5% discount if registered by January 20. Payment in full is required by April 30 or the discount is lost. This strategy encourages registration sooner and spreading out cash flow throughout the year. Additionally, you have that camper committed to you for next year rather than that “other” camp down the road.
– Negotiate! Get in touch with your suppliers to talk with them about getting better terms. If your camp has the luxury of knowing how much of a given item they need to order in advance, most suppliers are willing to negotiate terms to secure your order earlier. Terms may include discounted prices or even increasing payment terms allowing you to hold cash longer. This will help save money when spending is high and revenue is low. If you aren’t comfortable negotiating, I recommend this book, “Getting to Yes” by Fisher, Ury and Patton.
– Collect on late-payers. Review your database for outstanding payments and get in contact with those payers to arrange a payment plan.
– Unload Inventory! Inventory is not cash so get rid of it for what you can get for it. I am referring here to all those extra t-shirts that weren’t purchased during the camp season. Blast out an email offering discounted prices for left over merchandise. They make great holiday gifts!
These are only a few suggestions but certainly worth exploring. Don’t hesitate to explore, network and get creative with solutions to help with cash flows. The key is to think and act strategically and do what makes sense for your organization.
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Okay, so let’s talk camp…..finance.
As we approach the end of July, many camps are beginning to see the light at the end of the tunnel. For camp directors this is a bittersweet time; the end is near meaning the stress of making sure everything is running smoothly and the joy of camp are both soon to come to a close. However, for many camp directors, they lie awake at night trying to figure out how to fill the remaining spots with gleeful campers this late in the season, no doubt compounding the stress factor.
What better time is there to introduce the topic of camp finance and economics than late season?
For those camps that run into late August, it might not be too late to consider fixed and variable costs. All camps have fixed and variable costs. Fixed costs, as I am sure you are aware, are those costs that you are going to pay regardless if you have one camper or 1000. Variable costs, on the other hand, are those costs that go up with each additional camper you add. If you are in a position of having those latter parts of August with open slots, perhaps it is time to figure out what the cost of adding one camper really is. And, if you can do that, you can make some irresistible last minute offers that will get campers to come to camp and experience the reasons why your camp remains successful year over year.
So what are the variable costs per camper and how many of you know this number for your programs? Are your fixed and variable costs clear to your organization? What is being done to minimize both fixed and variable costs so that you can maximize profit and increase participation?
I welcome the contributions and feedback of the experiences related to finance and economics around your camps and look forward to continuing this discussion as we explore these and other business related aspects of camp.
Ryan Miller, MBA