Business Management

One On One

At some point in every nail technician’s career, she will have to choose between working as an independent contractor or as a salon employee.

At some point in every nail technician’s career, she will have to choose between working as an independent contractor or as a salon employee. How do you determine which situation will work best for you? By researching the advantages and disadvantages of each, and by talking to your peers. In this month’s One on One, salon manager Rosemary McDonnell, an employee of Notorious Nail Salon in Green Brook, N.J., talks to independent contractor Kim MeGrady, a nail technician at Tips Nail & Image Center in Redwood Shores, Calif., about the ins and outs of working as an independent contractor.

McDonnell: Do you have to supply your own products and implements?

McGrady: Yes, I do. I However, we all work together in a cooperative effort to purchase products in bulk. Everything from powder and liquid to pedicure supplies is purchased in large quantities and used by all technicians as needed. The total for each month’s product purchases is divided equally and paid by all technicians with their rental fees for the next month.

McDonnell: Do you bring in your own clientele?

McGrady: Yes. Again, we also support each other and contribute to customer satisfaction by servicing another technician’s clients if she is not available. This keeps the customers’ needs met and promotes teamwork and efficiency within the salon.

McDonnell: Must you abide by the salon policy? For example, dress code, hours, etc.

McGrady: We do not have any set “rules.” We do, however, work together to promote our salon culture and maintain a high standard of professional ethics. By doing this we are able to maintain consistent, high-quality service for our clients.

McDonnell: How are you paid? Do you earn commission on services? on retail?

McGrady: Each technician collects her own service lees as an independent businessperson. We also earn 50% of the net profit on retail sales of salon products, which is deducted directly from the next month’s rental fees. Through retail product sales we are able to greatly reduce our monthly rent.

McDonnell: Why do you work as an independent contractor?

McGrady: For several reasons: The first is economic. I bring home 80% more income than I earned as an employee. I also like to choose the hours I work as opposed to having the salon owner impose his or her work schedule on me. Ultimately I am solely responsible for the success or failure of my business and I like that.

McDonnell: What are the advantages and disadvantage’s of being an independent contractor?

McGrady: There are a few disadvantages and many advantages. One disadvantage is that independent contractors do not receive any benefits, such as medical coverage and vacation pay. But in my experience, the large chain salons’ medical coverage, for the most part, is not better than the individual plans that are offered by the major insurance companies. Another disadvantage is the self-employment tax. Independent contractors must pay the entire social security rate, while an employee pays only 50% of the social security tax and the employer pays the other 50%.

The advantages, though, are many. I make significantly more money than what I made as an employee, even after taxes and expenses. I can work a regular schedule and take vacation time as needed, as opposed to being told when I can take a vacation and when to return. I also don’t have to worry about the receptionist forgetting the confirm my next day’s appointments and any subsequent loss of income.

 

 

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