Did you set up your own business with dreams of more freedom and time, and now find yourself wondering when you’ll next get to take a day off? You’re not alone!
Unfortunately, as an industry, we’re not making much profit and the old 80:20 rule is actually more like 95:5. Despite so many hugely talented individuals, only about 5% of salons are actually making any real money.
But why is this?
We’re not adequately putting up our prices to keep up with rising costs and as a result, our profit margins are suffering.
For many newly qualified stylists and therapists, opening your own business is the obvious next step. But whilst our technical hairdressing skills and customer care are top notch, when it comes to actually running a business, we have to learn on the job, learn fast, and often fudge it on a daily basis.
The reality is that every business success is grounded on business know how. And without that business know how:
- You’re time poor
- You work late and long hours
- Your team gives you headaches
- You wear all the hats in your business
- You make the most money whilst others sit out the back
- You stay awake at night worrying about bills, the team, the clients, the rent etc.
- You make no profit… just wages that you’d be making for someone else… or perhaps even less!
The madness has to stop - now! So, what can you do about it?
Your Dream Day!
Imagine arriving at the salon. Your team are already cleaning and preparing the salon for the day. You lead a short, but productive meeting to propel sales, setting a 20% growth target for the day.
You head to the gym for your 9.30 yoga class. After a few 1:1 sessions with your team you meet your business coach and mastermind group for some new inspiration and to sanity check your current ideas. You meet your marketing co-ordinator and then cover the desk while your front of house goes to lunch.
It’s nearly 3 pm, so you head out to pick the kids up and stop off at the park before heading home for some family time. You’re looking forward to spending the evening planning your next trip around Egypt and your team’s next trip to a hair expo as part of your team bonding and education programme. You know a good night’s sleep is ahead of you, and even when a staff member decides to leave or gets pregnant you feel at ease that you got this!
Does this sound like a life worth living? I believe a business should be built from your dream and designed around how you want to live…not being hostage to your business and left with the scraps left over from hard work and long hours.
Follow my 5 steps to freedom and profit and it’s well within your reach.
- Get clear on your goal – Design your ideal life
You really do have the power and freedom to choose what you want your life to look like. The only thing stopping you is your ability to IMAGINE what that life might look like, or your BELIEF that you can achieve it. Do you have a growth mindset or are you fixed where you are? Don’t let a lack of confidence hold you back from going out there and LEARNING how to achieve the success you want. No one was born knowing the how… we all have to learn it.
Get specific and believe that with strategic work and planning, you can have the life you want and it doesn’t have to come at a cost of long hours of hard yaka.
Ask yourself this… Do you have clarity around how much do you want to earn in your take home pay? Have you set yourself a goal around how many hours do you want to work in and on your business?
When you take action, plan and commit to the life you want (by learning how it pull it off, rather than staying still and complaining) you will start to create the life you want!
- Know your business model numbers
I believe in growing your business around what you want as a business owner…first. What you want in terms of income should mould your whole business model. Getting clear on the numbers will help you build your dream business. When you have a clear income goal set, you can get clear on what your sales need to be and how many you need in your team to get you there.
Reverse engineer your numbers and plan your business operations from a place of your life, income, profit and personal income goals. When you’re clear about what you want to achieve, you can be clear about what your business would need to look like to achieve it.
Remember your accounting profit is not your take home profit? There are many expenses after profit which need to be factored into your budget, including debts, taxes, purchasing new assets to grow the business and increased stock holdings. Plan for your profit to be more that your take home pay.
- Check yourself before you wreck yourself
My guess is that you’re wearing too many hats and spending all your time with clients and doing the book work late at night or on your day off. If this is the case, then who’s actually running and growing your business?
The first step to growing your business is to close your books. Stop taking on new clients yourself and focus on growing your team so they can grow the business income. You’ll get a more engaged team and stay with you when you give them the attention they need and deserve. No one works hard and stays long term without attention, development, love and care from their employer.
When you make your team your primary client and treat them as well as your treat your paying clients, your team will grow and flourish.
Saying no to your current clients, without actually losing them is a practiced skill. Clients build rapport with a stylist and you can engineer this feeling by matching them with an alternative stylist through their Interest, personality or technical skills
Transition off the floor gradually , cutting your ‘working on the floor’ hours 20% at a time. Take time to really weigh up your client time vs owner time.
What will you work on if you’re not doing clients? I get this question all the time… Well tip 4 & 5 answer this exact question… Work ON your business and focus on income generating activity!
- Work ON your business – External Growth
Income generation is now your number one activity, so spend your time on activities which attract new clients into your salon for your team to tend to.
Are you clear about who you are as a brand? What makes you stand out from the crowd, what is your signature service that people come flocking to your salon for?
Once you are clear on this make sure you know who the ideal client is, who wants what-you-got. Your marketing strategy should speak to her directly, show you as the expert in your area in your field of expertise. Make it as easy as possible for new clients to find you, connect with you and book with you. In today's digital world your online strategy is do or die for your salon.
- Work ON your business – Internal Growth
You know any headache you might have are going to come from the internal workings of your business… mainly your team 😉 When you have the time to invest in your people, encourage, support and promote your team, they will maintain that fully-booked mindset – Employ, train and maintain a team to reach their goals, and yours – remember your team are the backbone of your business. An investment in them is an investment in your business too.
You can’t grow your dream business without providing effective one-to-ones to grow each individual. Consistent one-to-ones are key to helping your team members build their book of clients. Keep these meetings focused on the client.. it’s not about the stylist and what she wants, rather how can she deliver a 10/10 for the client. When this is the goal your average client spend will improve on it’s own.
Retaining those cient you already have is easier and less expensive that finding new ones so I can’t stress enough how valuable it is to keep your current clients coming back for more.
Introduce a loyalty, points or membership program – it keeps your clients for longer by rewarding their loyalty to you (and how much they spend with you) despite your team who may come and go.
Worried about your team - listen to this podcast episode Building a Brand Stronger than the Team you Employ and this blog 3 Ways to Build your Brand from the Inside Out… they will help you build your brand without feeling hostage to your team.
When it comes down to business, you need to do the math first as part of your ‘design your life’ process. Baby steps, but create as much time as you can away from the chair in order to both grow your team and your business... and reduce burnout as an added bonus.