Money Matters

The Compensation Dilemma

How can I earn more? Which system is best?

Way up on the list of employee desires is health insurance. It is not only expensive for an individual to insure herself, it is often difficult to get on choice policies. Unfortunately, few salons are able to offer their nail technicians health insurance. Trish Phelan, a New Jersey nail technician and her co-workers solved this problem by banding together and purchasing a group health plan on their own. The plan is independent of the salon, but they are able to enjoy the benefits of a group plan by joining together.

A salon owner whose relationship with her technicians is one of employee/employer (rather than independent contractor) must, by law, offer certain “benefits”: unemployment insurance, worker’s compensation insurance, withholding taxes, and a year-end W-2 (employee earnings statement).

MONEY ISN’T EVERYTHING

While benefits that you would otherwise have to pay for yourself (like insurance, parking supplies) are highly desirable, there are other benefits of which a price cannot be attached. If you are a technician considering a salon, don’t neglect these considerations; if you’re an owner, don’t forget to emphasize these benefits in the employee interview.

While many salons are not able to offer paid vacations to employees, some do offer technicians their base salary for a week’s vacation. Other salon owners try to stay flexible with time off; some even allow technicians to make their own schedules.

Anything a salon offers a technician to help her further her professional knowledge or technique is a valuable benefit. Look for salon owners who are willing not only to allow you time off for trade shows and competitions, but who will pay your entry fees or traveling costs. Also, some owners will help you promote your competition wins by displaying your trophies or certificates, announcing your victory with fliers or some other form of advertising, or sending a press release to local papers. On-the-job training is a priceless benefit. Many owners are more than happy to share their knowledge and expertise with their technicians. Good training not only makes you a more marketable technician to salons, but makes you more valuable to your customers. Clients rely on the knowledge of their technicians, and the more you know about your field, the more confidence you will inspire in your clients.

And certainly there are non-tangibles that can make doing nails more than just a job. Things like the atmosphere at the salon contribute to a sense of belonging and a feeling of job satisfaction. Do you enjoy your co-workers? Is the salon in a nice area of town or convenient to places you need to go? Is your commute short? Does the owner provide high-quality products in a high-quality setting?

Do you have your own table or do you share? Is the salon’s reputation good? Working for a well established and highly regarded business enhances your reputation as well. Getting your nails or hair done free at the salon is another terrific benefit.

GIVE YOURSELF A RAISE

What makes the compensating dilemma a dilemma is deciding which method to use in your salon as well as figuring ways to increase income. Very few salon owners we spoke to offer employees opportunities for a formal raise in the classic business sense, where once a year employee performance is reviewed and a raise granted (or declined). But there are ways you can increase your income even if you believe you are currently working at maximum capacity.

Paul Gilmore reviews her technician monthly. She meets with technicians individually and discusses their earning goals, how they can increase their productivity, and what skills they would like to learn or improve. Key to this review, says Gilmor, is that she asks technicians how the salon can help them achieve their goals. Also, every morning the staff takes three minutes to review the day’s client cards and set a daily earning goal.

To increase your own productivity – and thereby, your earnings – your first plan of attack is to fill your appointment book if you haven’t already. There are many ways to increase your business – advertising, promotions, sales – but nothing will do more for your long-term success than simply being great at what you do. Word-of-mouth referrals are the most effective advertisements (not to mention the cheapest), and those clients referred are often the most loyal. You must be constantly perfecting your techniques, increasing your knowledge of nail technology and chemistry, and bettering your sales skills. When you perfect your techniques and shave time from certain services you will be able to service more clients a day and earn more income.

The successful nail technician of the future will be a skilled salesperson. If your boss offers a commission or incentive on retail sales, the sky is the limit to what you can earn by suggesting home nail care products to your clients. You need to make clients aware of the benefits of home care of their nails as well as the superiority of professional products.

Incentives for retail programs are on the rise and have tremendous potential to help you earn more money. Most of the technicians and owners we spoke to pay commission of 10 percent to 20 percent on retail sales by technicians.

If you’re a salon owner, you need to evaluate not only what works best for you in terms of employee management, paperwork, and your own earning potential, but what will motivate your technicians to earn the most money of themselves (and thus for you). What can you provide a technician, in the way intangible and intangible benefits, to keep her and her clients with your salon? And if you’re a technician, how can you improve your service so that you see more customers daily, do fewer repairs and re-dos, and develop more referrals? Also, you must learn the business of retail so clients become loyal to professional brands and professional service. It isn’t every profession that lets you write your own paycheck, after all.

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Keywords:   booth rental     compensation systems  

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