In Olde England, when one monarch died and another took the throne, a town crier would walk the streets calling out the phrase, “The King is dead, long live the King”, (or Queen, if that’s the case). That is how the population learned that there was a change in ruler. And sometimes that was good news!
At some point, it has to sink in.
In the beauty industry, when a salon dies, we hear the cry, “The salon is dead, long live the system, let’s do it all over again the same way until this salon dies!” Okay, are you hearing a little frustration from the Two Blondes? You ARE! It is very frustrating to watch business after business make the same mistakes over and over again, no matter how many times they are counselled against it. The outdated business model of the ‘00’s no longer WORKS!!
Another new salon surfaced in our area last week. To get started they seduced stylists from other salons with the offer of a 60% commission; which, of course, is really closer to a 73% commission when you take into consideration the added holiday pay, stat pay, workmen’s compensation, employment insurance, pension, etc. Industry average for product costs sits at about 10%, leaving the owner with $.17 cents left in every dollar to pay rent, utilities, support staff, education, etc. In a business where the general rule of thumb is that for every dollar you spend in expenses, you need to generate $3 in revenue, this salon is already on a death march to ruin!
Why Are We So Resistant to Change?
Harsh words? Yes! Truth? Yes! But the burning question is, “Why?” Why are we so resistant to change? And by change we mean looking at an industry that is suffering and being prepared to make the changes necessary to insure it continues to exist. Make no mistake; our industry is in trouble! Make that a capital “T” Trouble! This isn’t the first time we have seen a new owner make the mistake of offering commissions that are too high. They haven’t all failed, but none that we know make a profit; they just exist.
Next on our frustration list are the service providers who are swayed by the “shiny object” of 60% commission! What are we teaching in the schools and where are they getting the information that this “over the top” commission creates a viable working model?
Here’s what happens down the road:
The salon owner finally realizes that he is paying too much money to certain service providers and arranges that new clients are steered towards the service providers who are on the lower end of the scale. Of course there will end up being service providers making less! The first hires are the “lost leaders”! They are used as a draw to steal clients from other salons and give the salon a “good” start. Then the owners hire other stylists at a lower commission. Does the word spread in the salon about who gets what? You betcha! Create tension? You betcha!
And if you are taking umbrage about what we are saying; remember that the Two Blondes SEE this happening every week in cities and towns all across the continent! Nothing changes if nothing changes, and the Blondes seek change!
Photo by Michał Parzuchowski on Unsplash