Absolutely! Complete knowledge on what to budget for, what to spend on, what to build out, what types of products and equipment to purchase, how to hire, what to charge, and when to look for professional advice are all vital to success. By understanding all these pieces to the puzzle, you’ll be well on your way.
Forty-five percent of NAILS readers’ salons offer skin care, according to NAILS 2006-2007 Big Book. And it’s no wonder why. With 78 million baby boomers and more than 100 million members of Gen X and Gen Y, more people than ever are concerned about proper skin care. But how does a nail salon owner or technician begin to tap into this growing market?
What You Need to Know First
According to Gary Alquist, an experienced industry consultant, what you need to understand first is that adding a room for skin care treatments will cost you three times more per square foot than a hair or nail space. Not only are you looking at a higher cost to build out that space, but you’re also looking at higher costs for setting up your back bar.
“It takes approximately three skin repair technicians to fully support the use of one treatment line,” says Marilyn Carter, manager of Rare Accents Salon and Day Spa in Palm Harbor, Fla. “Skin care products are a big investment. They have short shelf lives and may fit too broad of a clientele to support those sales. To jump-start your return, do research and choose a line that best fits your market and has a low minimum reorder and great customer support.”
Understanding how many skin care techs you’ll need is key to establishing a budget for purchasing equipment as well as your build out. “You’ll need two-and-a-half-times more clients as a skin care technician than a nail specialist because of the client’s annual frequency,” explains Alquist. “Focusing on selling packages for treatments, rather than one-time visits, will generate a faster financial return. It takes approximately 50 packages sold to justify investing in any machine,” adds Carter. “The bigger return comes from serving the client interested in skin repair, not just a relaxing facial or some waxing.”
Another factor to consider before deciding on a budget for space design is how many skin care technicians your space allows for. “Double shifting is the way to go,” says Carter. Having one to two rooms and making sure that the space is always utilized by employees sharing that space will provide full coverage for all hours of operation.
According to Lauren Gartland, president of San Diego-based consulting and coaching firm Inspiring Champions, “How you hire is paramount to your success. Finding someone who is self-motivated, has a great attitude, and is committed to serving her clients with diligence and integrity is key. Not only is the hiring process important, but consistent training for all technicians in learning the latest techniques, services, and equipment are what keeps the clients coming back for more.”
“We had a full nail service clientele when we decided to bring in skin care,” says Lisa Kirkland, owner of A Perfect Pair Nail Spa in Dunedin, Fla. “Our clients trusted our hiring process and our choices for product lines to carry. Right from the start, we promoted the idea of having multiple services done at one time. Because of the technician’s level of expertise and professionalism and our ability to use word-of-mouth within our existing clientele, it was a slam dunk. She was fully booked in no time.”
If You Build It, Will They Come?
So just how will a salon attract that much new business? “Network, network, network,” says Carter. “Let the world know how passionate you are about the products and services you offer. Use your fellow coworkers and build incentives for them to refer their existing clients to you.” Keeping your existing clientele educated on the latest trends and techniques is crucial to consistently creating new buzz. “I like to send out newsletters to all my clients letting them know what’s coming up in packages for products, services, and gift certificates,” says Kathie Kirkpatrick of Kay’s of Percilla in Percilla, Texas. Newsletters are also a great way to get the word out about your referral programs and incentives for your existing clientele to reap rewards. “Everyone likes to win something. Referral contests are a great way to reward your clients for sending you new business,” adds Carter.
“How good an esthetician is at what she does and the confidence she has will make or break her success,” says Kirkland. It’s a fact that today’s consumer is more educated and more demanding when it comes to skin care products and treatments that produce results. They’re looking for a professional who is very knowledgeable, has experience, and is always educating herself on the latest trends and services to maximize results. Besides the traditional facial, a skin care tech can also offer facial and body waxing, eye treatments, spray tanning, aromatherapy treatments, and permanent makeup.
In order for a client to achieve results quickly, she relies on proper at-home maintenance products. This creates an enormous opportunity in the area with your largest profit margin: retail. “A salon today can expect between 4%-7% profit on service sales. Pretty low compared to 23%-26% on retail sales,” explains Alquist. “Setting up incentives for retail promotions not only for employees but also for clients has been the key to our success,” adds Carter.
“Not only were we looking to bring more diversity to our clients as far as the services we provided, but we knew the kind of return we could generate on our retail sales,” says Kirkland. “Our esthetician will sell between $2,000–$5,000 in product each month.” She owes that success to cross marketing.
Diversity Is the Key
For Kirkpatrick, the story is one of diversity. “I am a fully licensed cosmetologist and certified aromatherapist. I wanted to offer a day at the spa where one could have a manicure (with or without extensions), pedicure, facial and/or body wrap, scrub and massage. I saw a definite need to add nail care services. The packages are where the money is,” she says.
“A business built on waxing is not as profitable as one built on skin repair or diversity in treatments. Without skin repair options, you are limiting your retail opportunity and developing a ‘working hard, not working smart’ situation,” says Carter. “You can reach a goal of $300 a day in sales with 20 clients all having a $15 service or with four clients at an average of $75 a ticket. Which type of day would you prefer?” Adds Kirkland, “We average $40 per hour doing nail services, but average $85-$90 in skin.”
So What Are the Down Sides?
Understanding your budget for setting up these services and how to price them goes hand in hand with what one can afford to buy and how to compensate the technicians properly. “That’s where turning to an expert can save you thousands in the long run,” says Carter. “By having complete clarity on all the overhead required to perform each service on the menu, a salon owner can see a return on her investment much more quickly and avoid some very costly mistakes.”
Some of those mistakes come from pricing packages. Don’t be caught in the trap of discounting services to sell gift certificates. In doing so, a salon will cut the profit margin too much. “Most salons price their services by checking out what all the other salons around them are charging,” says Alquist. “That’s a dangerous game to play.” Understanding your salon’s overhead and compensation structure first will help you determine exactly what a service will need to generate in terms of dollars per minute. Even a $700 package may not prove profitable if supplies are costly and the time frame is too long.
“One thing we would definitely do differently is purchase exactly what equipment we wanted the first time,” says Kirkland. “We bought equipment that was middle-of-the-road only to realize it didn’t fit all our needs. Purchasing the wrong equipment wasted precious dollars at a time we wanted to be focusing on returns.”
Not having the proper compensation balance also limits your profit potential. “We started our skin care technician on a sliding scale to build incentives to produce. We started her too high,” says Kirkland. “It didn’t leave enough room for growth for any of us.
“Developing a level system that works for all areas — body waxing, facials, and treatment packages — is essential for growing your esthetician as well as your client base,” adds Carter. “We sought out professional counsel and guidance from experts in salon profitability to help design a program that fit our needs. By listening to those experts we were much better equipped to make the right decisions on what to purchase, who to hire, and how to train them in order to maximize our return.” As a result, in the past two years Rare Accents has grown 140% in service and retail dollars. So there you have it. Stay on top of your game and seek out great advice to watch your skin care business grow.
Heather Goodwin has been a top-producing nail technician and makeup artist since 1996. Goodwin is also a certified success coach with Inspiring Champions. She can be reached at (727) 224-0518 or [email protected].