Summer trough

Definition

The revenue collapse between school years, which no amount of demand in term time fills.

Why It Matters

A tutoring center earns on the school calendar and pays rent on the twelve-month one, so June through August is where the year's profit is decided. Camps, test prep and enrichment programs are the standard answers and each needs staff who are also on summer schedules. Ask for revenue by month for two years, and read the depth of the trough as the real question about whether the business clears its fixed costs.