Tags Posts tagged with "salon business"

salon business

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Dan Gold

One of the recurring themes we hear from stylists (and even owners on a regular basis), is “I don’t like to sell”. Here are some real truths: every service organization is selling something– either products, services or the people who give it. If a client comes back to see a stylist a second time, it’s because the stylist has sold their service value. That’s selling! So guess what: we are in the business of selling.

The sale makes the customer.

It took me a minute to get it, but here’s what it means: we often think that it is the customer that makes the sale, but if you change it around and look at it in a different light, you start to realize that the point of sale can be the pivot point in creating a long-time customer.

As an example, Catherine and I were out shopping the other day in a store we hadn’t frequented before. We weren’t offered any help on the floor, but finally found what we were looking for and proceeded to check out. We weren’t given any love there, either! Our discussion on leaving was, “Well, they didn’t make a customer there!” That idea of “the sale makes the customer” came back to me and I finally got it. If that store had given us the feeling that our attendance was appreciated and our business was worth something, that store could have made long-time customers out of us.

Nathan Fertig

So, let’s think about what goes into the sale.

Of course, the most important aspect of a sale is to have a customer! That means prospecting or finding the customers to frequent our business. Once we have a prospective customer, we offer to sell them something; in our industry, of course, we are offering time slots for services, and take home products for maintenance.

This is often where we, as an industry, fall down on the job. We leave all the decisions to the customer. We let them direct our business because we don’t help them in the decision making process. What makes a successful business is a returning client. They don’t come back unless you ask them! They don’t buy anything unless you ask them!

Most of us are not trained to sell. Selling isn’t a skill that you are born with; it is a skill that you develop. Make no mistake, every business that you and your employees will work for, will be sales organizations. You are either selling products, services, or your own personality.

In our industry, the products and services we sell to our clients enrich their lives.

We are their beauty experts. We ensure that their hair, fashion, scalp-health, skin care is up-to-date and increases their sense of wellness. We ENRICH their lives! Let’s change our attitude towards presenting our products and services to our clients and ENRICH their lives with our talents and products.

Let’s break down ENRICHING into something easy and manageable. Here’s Enrichment 101 in a nutshell! Let’s ASSUME every client or customer wants what we have to offer and offer it to them. Let’s word our offer in such a way that it ends up guiding our client in the decision making process. To do that we simply offer them ALTERNATIVES until we have satisfied their needs.

Here are a couple of examples:
  1. “Mary, you will notice re-growth from your colour in about four to six weeks. Let’s book your next appointment in that time frame so that your colour stays fresh. What works best for you: the beginning or the end of the week? Morning or afternoon? Which time works best for you, 9:00 or 11:00? “
  2. “Mary, the colour care shampoo we talked about to hold your colour investment is available in either an 8.5 ounce size or a liter size. Which works best for you?
Felipe P. Lima Rizo

It sounds simple, yet stylists and front-end staff often struggle with these simple techniques. The best way to overcome this objection is to create some simple scripts for employees to use and you can create your own, like the samples above. Then make sure that every staff member has a copy. The consistency of dialogue is very important. After a day or two of scripted dialogue, the conversation becomes your own!

Let’s face it; you can be the greatest technician in the world, but if you don’t have a client in your chair, are you still a stylist? We need clients to be stylists! To get clients, we have to sell our services. So, let’s get out there and practice!

 

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The front desk or reception is the most important profit center in the salon. This is where clients are greeted, checked in, moved along, checked out, rebooked, and sold to. They are the first impression of the salon that a client receives and the last impression that a client leaves with. A salon business relies on the front desk person to make a powerful impact on the client and therefore on the salon revenue.

This is a sales position and yes, you are working in a sales organization. Our product is a little different in that we also sell services in the form of time slots.

What makes a great sales organization? Great salespeople! And what makes a great sales person? Great dialogue. Most of us are not trained to sell. It isn’t something that you are born with– it is a skill you develop.

We understand that it will take time to develop this skill, so we have put together a handy guidebook included with examples of scripts for you to to put to good use: Scripting for the Front Desk.

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A great hairdresser that stays on the same page as you can be really hard to find. Tipping can set the tone for the relationship you have and when it comes to the person who is pushing back your cuticles or coloring your grays, you want to make sure they know how appreciated they are.

The Average Tip

In an informal poll from Aveda, guests have admitted that they tipped as little as 10% and as high as 25%. Most said they tipped 20%, though the average was more generous around bigger cities. Small town beauty shops report that 15% is more normal for their tips, while stylists in malls or drop-in salons often see even less with irregular clientele.

How Much Should I Tip?

Part of tipping will depend on how much work you are as a client. Clients with short hair who book appointments frequently for cut and color may tip less because their hair is less work and their business is more regular. Longer and more difficult jobs of drastically changing color or cut may be something to tip higher for. Last minute appointments should also be well-tipped as an appreciation for being flexible enough to slide you in. Guests with small children should also tip higher, since there is more that goes into keeping small kids entertained and happy during the appointment.

Tipping the Shampoo Person

If your hairdresser is not the one shampooing your hair, do not assume that your tip will be split. To avoid confusion or misunderstanding, tip a small amount ($3-$5) to the shampoo washer. If the shampooer is doing more work (applying toner or other products), tip accordingly.

At the end of the day, you want to have a great rapport with your hairdresser that makes you stand out as a client. You want to be the kind of client that can call last minute and be slipped in on a whim. This comes from properly appreciating the work that goes in to keeping you looking and feeling fabulous.

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Stylists come and go! We aren’t the only kind of business to have employees leave, but it is a business where your service providers are also your daily income. The sad thing about our industry is that most, and I mean MOST salon/spa owners haven’t a clue what to do when that happens! And we all know that when a service provider leaves, they take as many clients with them as they possibly can.

Is it fair? The quick answer is “no” since the client list rightfully belongs to the salon. But if a service provider is leaving, they were probably making plans weeks in advance, collecting as much data as they can. What can you do about it? There is so much you can do about it! Take a copy of this newsletter and post it on your bulletin board so that you will be prepared the next time it happens to you; because it WILL happen.

When an employee resigns, terminate them immediately.

Even if it means paying them out…Do not allow them to stay and collect more information! Before doing so, check all state, province or federal laws to be in compliance.

Send out a letter to their client list.

Call all of their upcoming appointments and offer that their next visit is at no charge (you do have all the addresses, don’t you? Thank you, Vagaro!). Explain the situation and let the clients know how much you value their business.  Attach an offer or gift card for upcoming appointments ($10 off WILL NOT suffice) If a client is worth $500,1,000 or 1,500 in a year…how much are you prepared to spend to keep them?

Keep an on-going relationship with all your clients and customers.

Send out newsletters with your own stories and hand-signed birthday cards. If you have a personal relationship with the clients, it is much easier to reach out to them and ask them to stay.

Always have one or two junior service providers in training.

Look over your list of resumes and make some calls! Even though some revenue walked out the door, what was actually left after they were paid (e.g. salary, commissions, payroll-tax, deductions), it’s not as bad as it seems at first glance. Do the math. Your calculator is your best friend in these situations!

In our business, providers never arrive and stay there. If you aren’t continually looking for new hires, you are going to be left behind. In the service industry, it is imperative that you make your business up with advanced, intermediate and junior service providers. AND be on the lookout for new and exciting team members.

Look at reducing expenses.

For every $100 you reduce expenses by, it means you need $300 less in sales. How can you generate extra revenue with the clients you currently have? By simply raising your average ticket by $5-10 per client you could cover the shortfall in sales! Do more with less!

BREATHE!

If employees have been considering leaving, they often have been a negative force in the business for some time. The winds of change can breathe new life into your business!

TAKING ACTION is the only thing that will move you forward FAST! Being a business owner is hard work, but the rewards are great.

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Before the concept of money, there was barter or exchange of services. For example, an ear of corn was exchanged for a fresh tomato. There was value determined by each ingredient of the barter. As commerce grew, it became more efficient to have a standard with which to exchange goods and money was created. Good and services exchanged today are still a form of barter; we just use money for valuation purposes.

If you ask a stylist why they wanted to become one, the last thing we hear is, “for the money!” Ask around and you will hear that stylists are who they are because they enjoy helping people or it’s an expression creativity. Yet, this can be an exceptionally lucrative business to work in.

The value of a service provider

The value of a service provider probably isn’t as great as the perceived value of the leader of your country. Perhaps it’s not as great as the head of a multi-national conglomerate or a brain surgeon. It is, however, a skilled trade! Not everyone could cut and dye hair color, or give a knowledgeable facial. In fact, there is a shortage of all kinds of trades’ people in our area of the world – their value is increasing as shortages grow.

There is VALUE in the services that we provide for our clients! It’s time to start asking for our worth and remove the fear in asking for our true value. Stylists attend more extra-curricular education than most professional people I know! With every hour of experience and every hour of education, our true worth grows! Catherine, as a stylist and then salon owner has attended enough education to earn two degrees! Your worth increases with every hour.

A look at money from the point of view of a business owner

There is a completely different connotation. Our industry has been working around a 50% commission structure for years, but as service providers we only look at our side and what we are taking home. It doesn’t stop there for the salon/spa owner.

After the 50% commission paid to a service provider, there follows:
  • vacation pay,
  • stat holiday pay,
  • employer portion of employment insurance,
  • employment portion of pension funds,
  • employment portion of workmen’s compensation. The employer actually pays out not 50% but closer to 62% in wages.
Then there is the cost of product used in the service:
  • chemicals,
  • gloves,
  • cotton,
  • caps,
  • back bar support, etc.
Let’s not forget the use of:
  • heat,
  • electricity,
  • and water.
Then there is:
  • insurance costs,
  • accounting fees,
  • computer costs and support,
  • support staff,
  • marketing and advertising costs,

And, good grief! What about the rent? Not just rent, the EXTRA rent demanded by the landlord for common areas etc. The owner of a business is lucky to walk away with perhaps 2% after everything is paid out on a service!That’s TWO DOLLARS out of every HUNDRED!

Pricing of services in a salon/spa is based on recouping costs incurred.

Each station must produce a certain amount of revenue in order for a salon/spa to maintain the status quo. A good business manager has scientifically determined the pricing within their business – respect those decisions!

And then there is money from the perspective of a client! Why do we assume what a client can or cannot pay for a service? Do you tell them how much they can spend when they go out for dinner? Or what they should pay to have their car serviced? So if pricing in a business is determined by productivity and relative costs, who are we to determine whether a client can afford the service or not! Isn’t that their business? Isn’t it their choice to enter to salon/spa and book a service?

It’s time to look in the mirror and give yourself a pat on the back – first for choosing to work within this industry, and secondly, because you are worth your weight in gold! I, for one, cannot live without my service provider! Thank you!

 

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The days of the ‘one-stop’ shop (aka all-things-to-all-people salons) are over.

The vast majority of hair & beauty salons are ‘me-too’ operations that provide pretty much the same kind of services and products as a hundred competitors within a ten-minute drive.  Hair salons do hair and beauty salons do facials, waxing, and spray tanning.  All of these same-same businesses will pretty much take anybody with a pulse.

The way forward to prosperity in today’s market place is in the niche.

There is absolutely zero marketplace advantage in being ‘average’. Be ‘the’ one salon in your town/suburb that becomes known as the go-to place for X, or Y, or Z. Research, discover, invent if necessary, products and services that are unique to your business, which cannot be found anywhere else.

Find a way to attract and exploit niche demographic and psychographic markets and learn how to specialize in them. One of the biggest drivers of this change is staring you in the face; almost nothing you currently sell cannot be found faster and delivered cheaper through a simple online search.

We ask the question to our business clients all the time, “Who is your target market?” Invariably, we are given a not-so-niche spectrum of “we serve clients ages three to 90.”

So, what is a niche and how do I find one?

A niche market is concentrating all marketing efforts on a small but specific and well-defined segment of the population. Niches do not ‘exist’ but are ‘created’ by identifying needs, wants and requirements and developing and delivering goods and services to satisfy them. As a strategy, niche marketing is aimed at being a big fish in a small pond instead of a small fish in a big pond!
In the beauty industry we have a number of niches we can capitalize on:

  • Men only salons
  • Mom spas
  • Curly hair specialists
  • Hair health salons
  • Organic/Eco friendly salons and spas
  • Med spas
  • Blow Dry Bars
  • Fine and Thinning Hair Specialists
  • Extensions and Wigs
  • Retail specialists
  • Color Specialists

There are as many niches as your imagination allows!

Not sure what your niche market is?  Ask your clients!  Put together a client survey that collects information on their demographics and at the same time also asks them:

  1. What they love about your business
  2. What keeps them coming back
  3. What other products and/or services would they like to see in your business.

Think about the sandwich store down the street that makes “hand-crafted” sandwiches.  Well, all sandwiches are made by hand, but focusing on that aspect makes them sound special.  They have created a niche for themselves.  The salon that “brags” about giving the best shampoo in the city has also created a niche.

You can also carve out a niche for yourself within your existing business.  For example, you may be a full-service salon with several exceptional colorists working in your salon.  Focus on that category and create a niche to draw clientele.  Let your advertising and tag lines reflect your focus and the expertise of your staff.

This year, find your NICHE!