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Are You Fulfilling These Salon/Spa Owner Responsibilities?

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Starting or buying a business is the easy part.

Creating a true success story is, without question, where the hard work begins.

According to statistics published in 2019 by the Small Business Administration (SBA), about twenty percent of business startups fail in the first year.

About half fail within five years. By year 10, only about 33% survive.

In the salon/spa industry, it makes sense that owner attention focuses on technical skills and customer service. But too often, the key owner responsibilities that define business success are overlooked — and even ignored.

Here the FIVE TOP owner responsibilities that must be fulfilled from day one all the way through selling the business:


  1. Create value for your business: Too many owners think salon/spa ownership is about building your people. Build your people and the money will come. That’s a fundamental strategic flaw that most owners make. KEY: You’re building a company and a brand capable of fairly compensating its employees and creating opportunities for growth. More importantly, your mission is to create value for your company to earn a return on investment when it’s time to sell.




  1. Control payroll costs: Because a salon/spa is a service business, labor costs will always be the elephant in the living room. If payroll cost control was as simple as picking “a good” commission rate or sliding scale, salons/spas wouldn’t have a track record of low single-digit Net Profit and/or chronic losses. KEY: Payroll costs must be relentlessly monitored and controlled. Whatever commission rate(s) you pay today, will eventually need to be adjusted to offset increases in operating costs. Raising prices to offset cost increases that automatically give commission employees a raise is self-defeating. That’s one big reason Strategies has been teaching and coaching our Team-Based Pay business model for over 28 years.

  2. Drive Net Profit: Profit doesn’t happen by accident. Profit is planned. That’s why Strategies defines Profit as a business outcome. KEY: With software like QuickBooks, there is no reason for any owner not to have timely and accurate monthly, even weekly, Profit & Loss Statements and a current Balance Sheet. And the one tool that helps guide owners to creating Net Profit is a 12-month Cash-Flow Plan that projects monthly revenue and expenses. Driving Net Profit means working your plan.

  3. Build cash reserves: If the Covid pandemic taught owners anything, it’s how vital it is to have a cash reserve (minimum three months operating expenses). It’s not about “if” that rainy day will come — but when. KEY: Building cash reserves is a learned leadership financial discipline. It means constant monitoring of your financials, living your Cash-Flow Plan, and channeling a portion of Net Profit to a separate cash reserve savings or money market account. If you’re not seeing that cash reserve line item on your Balance Sheet grow — you’re not working your plan.

  4. Don’t get trapped: Business ownership IS NOT about buying yourself a job. Too many owners get trapped in their own company. They’re stuck behind the chair or in the treatment room. When “being a service provider” in your business is your first priority, and your leadership work comes in second or third, you’ve bought yourself a service provider job. KEY: To grow your company — and have a life — you need to effectively and relentlessly manage your time. If history has proven anything, you can’t be a full-time service provider and lead your company. Financial management takes time. Employee management takes a lot of time. Planning takes time. Marketing takes time. You hire people to do the work of the business. Your hands can’t be the primary revenue generator. Got it?


Here’s my challenge to you: Yes, there are more than the five owner responsibilities listed here that you must focus on. But these five are the huge ones that will help you build the business of your dreams — and have a life.

Strategies has the systems and coaching to give you the essential controls and leadership skills you need to grow a dynamic and profitable company that takes great care of its people.

Schedule a free coaching session and find out how we can help you.

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