How to Move to Full-Time Leadership and Retain Your Self-Worth

December 1, 2019 | By Neil Ducoff | 1 Comment

Your passion has always been performing services and caring for clients. However, your salon/spa is growing in size, number of employees, and complexity.

You’ve been reducing your service hours but still find it a challenge to keep up with your business and leadership responsibilities. Something’s got to change.

After years of performing services, it’s time for you to become a full-time leader.

Decision made. You hold a team meeting and reveal your full-time leadership plan. You’ll finally be able get all that business stuff you’ve been stressing over done. Yay! Your team totally supports your decision.

Now comes the announcement you’ve been dreading — telling your clients that you are no longer doing services. As expected, your clients are not thrilled, but most are willing to try other service providers.

Fast forward six months…... Read More

Your passion has always been performing services and caring for clients. However, your salon/spa is growing in size, number of employees, and complexity. You’ve been reducing your service hours but still find it a challenge to keep up with your business and leadership responsibilities. Something’s got to change. After years of performing services, it’s time for you to become a full-time leader. Decision made. You hold a team meeting and…
Read More

Categories: Leadership

What Story Do Your Salon/Spa’s Financials Tell?

November 24, 2019 | By Neil Ducoff | 1 Comment

I’ve been reviewing salon/spa financial statements for 45 years, starting with my own two salons back in the 70s. Yes, I used to do hair and own salons.

Whenever an owner calls me for help with his or her salon/spa, I ask for the most current Profit and Loss Statement and Balance Sheet. Why? Because I need to know the story of how the company performs and what its state of health is.

The financials also tell me a lot about the owner’s understanding of financials, how much they pay attention to them, and the value they place on them.

In so many ways, a set of financial reports, specifically the Profit and Loss Statement and Balance Sheet, are a numeric readout of the owner’s financial thinking and behavior.

Here are some examples of the story financials tell me:

  • I expect to see financial reports that are no more than 30 days old. If the most recent financials are four or five months old, the owner isn’t paying attention to the financials, doesn’t understand them, or sees little value in them. If all I can get is last year’s tax return, there’s a big problem.
  • The Profit and Loss Statement must have the percent of income column. The percent of income column is the fastest way to see how the business is performing and where the money is going. If retail sales are less than 10% of total income, there are no systems, focus or accountability for selling retail. The percent of retail and professional product cost tells me if purchasing budgets are being used. The service payroll percent tells me if payroll is within benchmark and if the compensation system needs fixing. An excessively high rent percent tells me the urgency to grow revenue, or if it’s time for a serious conversation with the landlord. Every line item and percent tells a story.
  • The Balance Sheet quickly tells me how healthy the company is. If there is little to no cash, the company is in a financial crisis and most likely insolvent. It tells me if there is a cash reserve in separate savings account. It should tell me the total due in Accounts Payable. It tells me how many credit cards have balances and the total in credit card debt. KEY: Excessive credit card debt is a bad sign. It tells me how many loans there are and the principal balance of each. It tells me if the Retained Earnings are positive or negative. Negative Retained Earnings means the company has been operating at a loss for many periods. Lastly, it tells me if the Equity is positive or negative. Negative Equity means the company’s liabilities exceed its assets.

Here are some No-Compromise Leadership insights to ensure that your financials tell a story of success:... Read More

I’ve been reviewing salon/spa financial statements for 45 years, starting with my own two salons back in the 70s. Yes, I used to do hair and own salons. Whenever an owner calls me for help with his or her salon/spa, I ask for the most current Profit and Loss Statement and Balance Sheet. Why? Because I need to know the story of how the company performs and what its state…
Read More

Categories: Financial Literacy

The TOP TEN Reasons Salon/Spa Owners Should be Appreciated

November 17, 2019 | By Neil Ducoff | 4 Comments

Owning an employee-based salon/spa business can certainly be a mixed bag of feelings and emotions.

The good times are great. The bad times are, well, anything but great.

The one absolute is that it takes people — skilled, service-minded people — to make a salon/spa business work.

Hands do the work. Hands create service sales. Those hands are attached to employees. And leading employees is, without question, the toughest part of being an owner.

Salons and spas thrive or die based on the performance and productivity of their employees. That performance and productivity is the owner’s prime responsibility.

It is in the execution of this responsibility where employees see owners focused on what they could have done better, or, what they didn’t do.

So in their effort to grow the company and provide the best for their employees, owners often feel a lack of appreciation for all they do.... Read More

Owning an employee-based salon/spa business can certainly be a mixed bag of feelings and emotions. The good times are great. The bad times are, well, anything but great. The one absolute is that it takes people — skilled, service-minded people — to make a salon/spa business work. Hands do the work. Hands create service sales. Those hands are attached to employees. And leading employees is, without question, the toughest part…
Read More

Categories: Uncategorized

Seven Keys to Go the Distance — To Go Beyond

November 11, 2019 | By Neil Ducoff | 1 Comment

In just over two months, I’m going to turn 70 years old. And guess what? I still have goals for what I want to accomplish in my business and personal life.

My company, Strategies, is a young 26-year old. And guess what? It has goals for what it wants to accomplish.

The difference between me and my company is pretty basic. You see, achieving my personal goals is up to me and me alone. For Strategies to achieve its goals, it’s my team’s responsibility.

I’ve learned a lot of lessons over my almost 70 years. The most important lesson is that the responsibility to achieve what I want in life rests squarely on my shoulders.

To achieve it, you must earn it. To earn it, you must be committed to go the distance.

But what exactly does going the distance mean? To me, going the distance means seeing a project, goal or vision through to completion.

It also means dealing with the setbacks, roadblocks, wrong turns, bad decisions, indecision and other stuff that gets in the way.... Read More

In just over two months, I’m going to turn 70 years old. And guess what? I still have goals for what I want to accomplish in my business and personal life. My company, Strategies, is a young 26-year old. And guess what? It has goals for what it wants to accomplish. The difference between me and my company is pretty basic. You see, achieving my personal goals is up to…
Read More

Categories: Leadership

10 Tips for Salon/Spa Holiday Gift Card Sales

November 3, 2019 | By Neil Ducoff | 3 Comments

The 2019 Holiday season is upon us as the countdown to New Year’s Eve is officially underway.

Halloween candy, costumes and decorations are already replaced with Thanksgiving and all things Christmas.

Retail stores are geared up and ready for the annual mad dash to rack up record Holiday sales.

For salons and spas, the Holiday season is the single best opportunity for gift card sales. The question is, are you ready to go for your gift card pot of gold?

To make sure your gift card pot of gold is as big as it can be, here are my ten No-Compromise Leadership gotta-do’s:

  1. Gotta view gift cards as a good thing: Maybe it’s because gift card sales appear as a liability on your Balance Sheet (because you owe the GC holder services or products). Maybe it’s because too many owners spend gift card revenue as quickly as it comes in and are cash starved as redemptions come in. KEY: What could be better than exchanging a piece of plastic to pay for services/products that will be fulfilled at a later date? Absolutely nothing. It’s like magic money.
  2. Gotta manage gift card revenue: It’s financially dangerous to spend gift card money prior to redemption. When clients pay for service and products with gift cards, all the costs to fulfill those services and products need to be covered, including payroll and professional product cost. During heavy redemption periods, your salon/spa can be very busy with very little cash coming in. KEY: All gift card revenue should be transferred to a separate savings or money market account. As redemptions occur, transfer cash back into your operating checking account. The best game to play to build cash reserves is to resist touching gift card savings.
  3. Gotta believe your pot of gold is possible: Like anything else, the harder you work at selling gift cards, the better you’ll do. I’ve seen salons and spas crush their gift card sales goals because they went for it. Believing gives you confidence to do the hard work and make your pot of gift card gold a reality. KEY: Believing is half the battle. Execution is the other half. You’re not going to achieve 100% of your gift card goal with a 50% effort. Successful gift card sales require planning, scripting, decor — and energy.
  4. Gotta look like you’re in the gift card business: Retail stores are already stocked, decorated and geared up for big Holiday sales. Your salon/spa needs to do the same except that your focus is on selling Holiday gift card solutions. Yes, you’re selling gift buying solutions that are fast and easy. KEY: Special gift card packaging and bags should be prominently displayed in quantity in your retail and check-out desk areas. Your website should be shouting “gift card solutions” with an easy purchase process. Seek out a professional retail display specialist to help out.
  5. Gift card selling station: A great way to focus attention on gift card purchases is to set up a gift card selling station in your retail area. A nice looking desk, table or podium will do nicely. If you don’t have enough space in your retail area, make the stylist station with the most visibility your gift card selling station. KEY: Decorate the station with gift-wrapped packages and plenty of gift card packages and/or decorative retail bags ready for purchase. Staff the station during busy times. Have an iPad or tablet ready to ring up gift card sales.
  6. Advance special offer email campaigns: If your salon/spa doesn’t have an up-to-date client email list — shame on you. KEY: Emailing/texting out a special offer to your customer list is just smart business. Offer special packages or savings if clients order online or purchase onsite by December 1st. Do premium price points, as existing clients are the easiest to sell. For example: Purchase a $100 gift card and receive $115 in services.
  7. Everyone has gotta play: The bulk of gift card sales are done at checkout. This means your guest services team must be trained and scripted to up-sell clients at checkout. The mistake most salons/spas make is waiting to up-sell gift cards at checkout. KEY: At check-in, every client must be told, “Remember, we have some wonderful Holiday gift card solutions. We can tell you more when you checkout.” Every service provider should be scripted to simply inform clients, “We have some wonderful Holiday gift card solutions available when you checkout.” It’s not rocket science. It’s your entire team sharing Holiday gift card solutions with clients.
  8. Gotta avoid crazy discount incentives: If you’re running at 10% net profit and selling gift cards at 15% to 20% off, you’re shooting yourself in the financial foot. KEY: Be very conservative with your discounting. In fact, there is no reason to discount gift cards at all. Consumers buy gift cards for convenience and speed. Discounting may help sell more gift cards, but the financial impact may not be worth it. If you’re discounting gift cards because you need the cash to pay yesterday’s expenses and debt — you’ve got bigger problems to fix.
  9. You gotta keep score: At too many salons and spas gift card goals and sales are known to the few, not the many. You can’t create the energy and urgency that fuels teamwork when most of the team is oblivious to the game being played. KEY: Every daily huddle from just before Thanksgiving through January 15th should include a Holiday gift card sales scoreboard. It’s the best way to keep every team member playing the gift card sales game.
  10. Gotta retain new clients: The worst thing an employee can do is treat a gift card client as a throwaway because they may not tip as well and may not return. Dialing back customer service ensures that the self-fulfilling prophecy of small tips and not returning will occur. KEY: Every client is important. Every new client is an opportunity to become a retained client. Just because the method of payment is a pre-paid gift card instead of cash or credit card doesn’t mean that client deserves less.

Here’s my challenge to you: Why not do 25% or 50% more in gift card sales this Holiday season?... Read More

The 2019 Holiday season is upon us as the countdown to New Year’s Eve is officially underway. Halloween candy, costumes and decorations are already replaced with Thanksgiving and all things Christmas. Retail stores are geared up and ready for the annual mad dash to rack up record Holiday sales. For salons and spas, the Holiday season is the single best opportunity for gift card sales. The question is, are you…
Read More

Categories: Profitability

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