And what to do about it before the shoulder season hits
Ask any RV park owner what their favorite time of year is and they’ll tell you summer. The sites are full, the revenue is flowing, the energy is high and everything feels great.
And then September arrives.
For a lot of RV park owners the shoulder season is when the financial chickens come home to roost. The cash that felt abundant in July suddenly has to stretch a lot further. Expenses don’t drop as fast as revenue does. Payroll still runs. Debt service still runs. Insurance still runs. And if you didn’t manage your peak season cash wisely you can find yourself in a surprisingly tight spot on a property that just had its best revenue months of the year.
I call this the peak season trap. And it catches more new owners than almost anything else.
Here’s how to avoid it.
Understand your revenue curve before you close
Every RV park has a seasonality profile. Some are heavily summer weighted with 60-70% of annual revenue coming in May through August. Others have a more even distribution with strong spring and fall shoulder seasons. Some have winter demand driven by snowbirds or proximity to ski areas.
Before you close on any RV park acquisition you should understand exactly what the monthly revenue distribution looks like over a full year. Don’t just look at the annual T12 number, break it down month by month.
Ask for monthly revenue data going back at least two years. Map it out. Understand when the peaks are, when the valleys are, and how deep those valleys go. That monthly revenue curve is your cash flow roadmap for the first year of ownership.
Build your budget around the valleys, not the peaks
This is the mindset shift that separates financially savvy operators from ones who get caught short.
When you’re in peak season it’s tempting to make spending decisions based on current cash flow. Revenue is strong, the bank account looks healthy, and there are always improvements to make and expenses to approve.
But your peak season cash has to carry you through the valley. Every dollar you spend in July is a dollar that isn’t available in November.
Build your annual budget starting from your lowest revenue month. Make sure your fixed costs, debt service, payroll, insurance, utilities, can be covered in your worst month with your lowest expected revenue. Everything above that is your operating cushion and your growth fund.
If your worst month revenue can’t cover your fixed costs you have a structural problem that needs to be addressed, whether that’s adding long term tenants for stable monthly income, reducing fixed costs, or building a larger cash reserve before you close.
Use peak season to fund your reserves
Peak season is not just when you make money. It’s when you build the financial cushion that protects you the rest of the year.
Here’s the system I recommend for every RV park owner going into their first peak season:
Every week during peak season calculate what percentage of your monthly revenue target you’ve hit. Once you’ve covered your projected monthly operating expenses, debt service, and CapEx reserve contribution, every additional dollar should be split between your tax reserve and your operating cash cushion.
The goal is to exit peak season with enough cash in your operating account to cover at least three months of fixed expenses. That cushion is your shoulder season safety net.
If you hit that target and still have surplus cash, that’s when you think about reinvestment, improvements, or distributions. Not before.
Watch your expense timing carefully
One of the most common mistakes new RV park owners make is front loading expenses into peak season without thinking about the cash flow timing.
You want to repave the entrance road. You want to upgrade the bathhouse. You want to add a new amenity. All of those are valid investments, but if you execute them during peak season you’re consuming cash at exactly the moment you should be building it.
In general capital improvements and major discretionary expenses are better timed for the shoulder season or off season when your operations are quieter and your team has more bandwidth. Your cash will thank you.
Plan for the transition before it happens
Most new owners don’t start thinking about shoulder season until they’re in it. By then it’s too late to adjust.
The time to plan for the shoulder season is during peak season, when revenue is strong and you have the mental space to think clearly. Build your shoulder season budget in July. Know exactly what your cash position needs to look like on September 1st to get you comfortably through to the following spring.
Then manage toward that number intentionally for the rest of peak season.
The bottom line
Seasonality is one of the great joys of the outdoor hospitality business. There is something genuinely wonderful about a full park on a summer weekend. But it’s also one of the great financial risks, because the math of a seasonal business is unforgiving if you’re not managing it intentionally.
The owners who thrive long term are the ones who use their best months to protect their worst months. They budget from the valley up, they build their reserves during peak season, and they never let a strong July lull them into decisions that hurt them in November.
You can absolutely do this. And if you want a financial partner who tracks your seasonality with you, builds your cash flow forecast, and makes sure you’re set up for every season, I’d love to work with you.
Visit me at https://www.pvifinancial.com to get started with a free Financial Health Check.
~Wendi | PVI Financial | Fractional CFO & Bookkeeping Services for Small Business & Outdoor Hospitality
If this resonates you will want to read this next: “Why Profitable Businesses Run Out of Cash”
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