When times are tough, it can be difficult to think about growing your business. But that’s the right time to review your management practices and make sure you are doing everything possible to maximize your income.
“There has never been a better opportunity in your own town,” encourages Robert Cromeans, the owner of four multi-service salons in Southern California and Las Vegas. “People aren’t leaving town and going to Miami. They have $1,200 more of disposable income to treat themselves with.”
Start by looking at four pillars of good management: a monthly business analysis, client scheduling, customer relations, and employee management.
Analyze Your Business Monthly
You could start out with what’s called a “break-even analysis,” suggests Susie Fields, who has counseled thousands of beauty business owners over the past 12 years. Basically, you need to add up all your fixed expenses (such as payroll and rent) and your variable expenses (such as commissions and the cost of retail products), then deduct the total amount from your income. This will show you how much money you must bring in to meet all your financial needs.
Then, whether you rent a booth or own a large,multiple service salon, ask yourself these questions:
• Are my budgets for payroll, commissions, front desk, back-bar costs, retail products, advertising and overhead in line for a salon of my size and customer base? (see “Typical Salon Expenses” below)
• What does each of my services cost me? How much time do they take? Which are the highest income-earners? Which require the highest investment on my part?
• What is my average service sale and retail sale per customer? What proportion of my income is from basic services, add-on services, and retail sales? What is each employee’s (or my) average service and retail sales for the year? What is each employee’s rebooking rate? What is my customer retention rate?
• What are my goals for profit, shop size, and customer base?
As you answer these questions, a guideline emerges that becomes the roadmap for managing your business.
“Eighty percent of the salons and spas in the country are losing money because they don’t have budgets and don’t make basic business calculations,” notes Fields. “We are an emotional basket-case industry. By looking at their business in terms of profit and loss, owners can base decisions on the numbers rather than emotion.”
By creating profit-and-loss statements, balance sheets, and cash-flow reports, you will see precisely where your money is coming from and where it’s being spent in your business. Through her consulting firm Salon Training International in Oceanside, Calif. (now a division of Milady Cengage Learning Center), Fields has developed formulas to help beauty professionals figure out how much they should be earning and spending for a business of their size. Many techs will discover they need to charge more for their services.
“The profit-and-loss statement should dictate how much you charge for a manicure — not your community. Every time you do a fill, if you charge $15 because that’s what everybody else does, but it costs you $20, you’re slowly dying,” Fields observes. “You need to be up-selling, doing pink-and-whites. Waxing is another service that’s often underpriced.”
Fields urges business owners to computerize their information for what should be a monthly analysis of the entire operation. She uses the program QuickBooks Pro, which will automatically add up the numbers that you put into the program. She also recommends finding a good accountant who will give you a profit-and-loss statement (a report on where the money is coming from and where it’s going) in the first week of each business month, allowing you to make a timely analysis. You can get more help from the local office of the Small Business Administration, in community college courses, and through your local library.
Typical Salon Expenses (as percentage of gross service income)
Depreciation Cost 4%-6%
Source: Successful Salon Management for Cosmetology Students
Maximize Your Schedule
Think of your appointment book as a sheet of cookie dough. You cut the cookies as closely together as possible so as not to waste any of the dough, right?
Sahar Slosser uses that same idea when scheduling her customers at Anatomy Day Spa and Boutique in San Diego. That way, she earns the highest possible income for herself and her employees, while offering maximum availability to her clients.
Slosser blocks out each day’s schedule in 15-minute increments. She organizes them into blocks of one hour and 15 minutes, enough time to accommodate her longest and highest-revenue service. Then she trains her staff to schedule appointments according to those blocks, fitting the shorter services just before or after the longer ones.
For example, Slosser’s shop opens with its first block at 9 a.m. and the second block at 10:15 a.m. “If a client calls and wants to schedule a massage for 10 a.m., we say, ‘Well, we have an opening at 10:15. Would that work for you?’ The client agrees, and we still have a full block open at 9 a.m.,” Slosser explains. “Otherwise, we would lose that opportunity for the higher-revenue service.”
Saturday schedules are especially important. As clients call during the week for Saturday appointments, Slosser trains her staff to book these plan-aheaders for morning sessions. When the procrastinators call mid-day Saturday, she still has openings for the afternoon, because she has maximized her morning. She remains open seven days a week, further maximizing the return on her facilities investment.
At nails-only salons, blocks could be organized according to the time needed for a full set, with backfills or simple manicures worked in before or after the longest service, Slosser suggests.
To make the system work, look at the steps involved in each service and break them down into increments of 10 or 15 minutes. Be sure to factor in a few minutes to clean your table or scrub out the foot tub between clients. This will help you manage your time better, stay on schedule with your service, and let you see how to make each step more efficient.
“One thing your clients are going to love about you is you get them in on time and finish when you tell them you will,” adds Cromeans.
Tardy Clients Mucking Up Your Schedule?
Instead of making other clients wait to fit in a latecomer, Sahar Slosser of Anatomy Day Spa & Boutique in San Diego, trained her staff to put the burden back on the customer — nicely, of course. “We tell them, ‘We’re sorry, but we won’t have time to do all your services today. Would you like to skip the facial this time?’ Pretty soon, they get the idea.”
The Customer Is King
Great technical skills are, of course, the foundation for repeat business. But humans also crave human contact, and providing that is the key to customer relations at A Robert Cromeans Salons, based in San Diego. Cromeans’ simple motto: “The customer is king.”
“One-time customers are the worst case scenario for sales. You want at least six to 10 experiences. That gives you back on your investment in advertising,” says the motivational speaker and artistic director for John Paul Mitchell Systems.
Cromeans looks at the receptionist — whether it’s you or a front-desk staff of five — as the first point of contact for clients: handling appointments, coordinating between nails and other services, selling retail products, and serving cucumber water or cappuccino.
He trains employees in what he calls “the name game” to establish a connection between technician and client that helps cement customer loyalty. “You have to use their name eight times or more to establish the connection,” Cromeans says. “It’s the sweetest sound to anyone in the world to hear their name. The more you use their name, the less they feel like the three o’clock appointment.”
Customer service becomes a way of upselling your services, too, Cromeans counsels. By paying attention to what your customers need and like, you can tailor additional offerings while making them feel special. In addition to suggesting paraffin dips, luxurious massages, and smoothing exfoliants, think ahead about nail add-ons that reflect upcoming holiday themes, gift baskets, and gift certificates. Let your customers know well in advance about these specials so they can think about them.
Even booth renters and one-tech salons can add value to their service with the help of a tech-in-training who can serve refreshments, hand the waiting client a magazine, pick up dirty towels, handle the cash professionally, and wash cups, he advises.
Employees Need Love, Too
To give great customer service, you need a great staff that is as committed and excited as you are. This, in turn, makes them more productive and naturally warm with clients.
Once he hires his employees, Cromeans keeps them focused with flexible hours and on-site childcare. He says this makes sense for a profession that attracts young women who never imagine that a family may be in their future. It can pay in retaining well-trained staff.
“If you’re a small shop, try making arrangements with the daycare center up the street. This lets them think of their jobs as a career path. We’re not offering just a three-year relationship,” Cromeans suggests.
Medical insurance, paid vacations, 401(k) savings plans, and bonuses are important perks for employees, but how to work them into your already tight budget?
Try offering these benefits as rewards for reaching goals, such as increased retail sales. Even minimal policies offer some security, and are more affordable now than they were just five years ago, Cromeans says. And “well days” could be awarded as paid time off to outstanding employees with perfect attendance.
Continuing education helps everyone see a better future for themselves. Call up the companies whose products you use and ask them to train you (or your exceptional nail technician) as an educator for salons in your area.
Even in the most positive environment, conflict can arise. Vicki Benner tries to see conflict as an opportunity to build trust and teamwork in her role as nail department director for the Chazios/Bladez Salon in Lake in the Hills, Ill. “Conflict only occurs when people care about the issue,” Benner observes.
Listening is the first step in resolving conflict. “Listen carefully, from the heart. God gave us two ears to listen and only one mouth, so use them accordingly. And take the time to thoroughly think through both sides of the issue,” Benner advises. She then asks the people involved in the conflict to think of two possible solutions to their problem.
When the mistake is her own — despite her best efforts to set a good example — Benner earns her employees’ respect by asking their forgiveness and promising to try harder. By working through the problems together, everyone learns and grows, Benner says.
No matter what size your business, reaching your dreams and those of your employees is what good management is all about.
Build Repeats With Creative Marketing
One way to grow your business is by increasing repeat visits. “The average nail customer comes in 17 times a year,” consultant Susie Fields of Salon Training International in Oceanside, Calif., says. To raise that even by one or two bookings a year lifts revenue.
Susie Galvez of FaceWorks Day Spa in Richmond, Va., uses exotic travel themes to entice customers. “We have a ‘Passport to Beauty’ program and come up with seasonal ‘menus’ that we mail out to our client list,” Galvez explains.
Nail techs reflect the themes in both decor and products. For a Cleopatra inspired menu of Egyptian luxury, they poured real milk into foot spas (along with foaming, antibacterial soap), spread a mud mask on clients’ legs, used a milk-and-honey cream for legs, feet, and hands, and suggested dark, rich nail colors with a sparkly gold top coat.
For the Hawaiian Holidays program, employees dressed in khaki shorts and Hawaiian shirts. For a South American menu, they used mango-scented products and offered bright colors. When the passport was for the Orient Express, they used Chinese green tea exfoliant. For their Roman getaway, they offered olive oil massages.
The special manicures and pedicures cost $5 to $15 more than the regular service. “We get it because the clients love it,” says Galvez, who is working on her third beauty book.■
Trina Kleist is a freelance writer based in San Diego.