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Working Owners: Why You Must Work More ON than In Your Salon/Spa
September 19, 2016 | By Neil Ducoff | No Comments
As a working owner, when you say, “I love doing [hair/skin/nails/massage]” … it is a true expression of your passion and commitment for the technical and creative work that got you into business.
Your work defines and fulfills you. And it should.
But the day you become a salon/spa owner … what defines you changes. Like it or not, your focus, determination, responsibilities and accountabilities are forever changed.
- It’s no longer about what your hands can create … it’s about what you can envision, execute, organize, systematize, innovate and inspire.
- More than anything, it’s about your ability to be a leader.
Doing great work is a very different career path than leading great work. Doing great work is a personal expression of your creative and technical talent.
Leading great work is about growing a world-class company that is profitable and sustainable.
- The size of the company doesn’t matter. In business, how effectively, precisely, uniquely and efficiently it operates is everything.
Just like your passion for your technical and creative work defines you as an individual … how you lead your company and your employees defines you as a businessperson.
And here’s your wake-up call: Your company needs you more as a leader and businessperson than it does as a service provider.
Here are six undeniable facts as to why your company pays a price for every dollar you generate with your own two hands:
- Leadership takes time … a lot of time: The more time owners spend working on “their” clients … the more overwhelmed they are with the responsibilities of leadership. The cash-flow plan and numbers can wait another day. Those performance reviews that should have been done months ago can wait a bit longer. That “fierce conversation” that should have happened a long time ago can wait a little longer. The “It will have to wait” list is truly long and overwhelming. And the longer it waits … the more it costs your company in inefficiency, culture contamination, waste, missed opportunities and more.
FACT: You can’t lead and grow a world-class company in between clients.
- The ticking time bomb: Congratulations … you bring in a lot of money. But what percentage of your company’s total revenue do you produce with your own two hands? The greater that percentage … the louder and faster the ticking time bomb gets. Why is it a ticking time bomb? The simple answer is that the more revenue your hands generate, the more YOU are the business. And the more YOU are the business … the more stuck you and your business become. You’re stuck because your personal income (and life style) is overly dependent on what you generate as a service provider … not as the business owner.
FACT: If something happens to you and you can’t service clients … the cash crisis bomb explodes. All you did was buy yourself a job rather than grow a company.
- You can’t “wish” excellence: Quality and consistency takes work, training, coaching, systems, practice and persistence. Get the picture? How perfect and consistent is your salon/spa phone answered? How perfect and consistent are those consultations performed? How perfectly and consistently are clients sent to check out with thorough pre-book and retail recommendations? Are you charging less for new talent because you don’t have the time to intensely prepare them to deliver quality at a higher price point? Get the picture? Excellence is an outcome. The driver is relentless preparation.
FACT: You can’t create excellence if the bulk of your time is standing behind the chair or in a treatment room.
- Controlling cash flow: Yes, I know many owners hate the numbers side of the business. But business IS as much about numbers as it is creating great work and customer experiences. The numbers measure how effectively you execute the work. I’ve seen more than my share of busy salons/spas that are cash starved and up to their eyeballs in debt. That’s what happens when the numbers side of the business doesn’t get the attention it requires … or is ignored completely. Business is about creating profit and positive cash flow. Going out of business is about overspending and creating debt.
FACT: If you don’t have the time to address the financial management demands of your business, you’re going to be dealing with financial stress. Financial stress is brutal.
- Creating career paths: Salons and spas are notorious for high employee turnover. Walkouts are not only commonplace … they’re devastating to a business. Suite developers are marketing directly to your employees with the promise of freedom and “keeping a bigger piece” of “their” service revenue. Watching columns on your appointment book relocate to a competitor, booth rental or suite, is the definition of insanity. There is no secret to staff retention. Employees stay where they’re appreciated, valued and provided with a clear career path. Employees stay where they’re positively challenged to be their best … to contribute and be part of something exciting and extraordinary. The age-old industry paradigm that success is “building a full book” is just that … an old worn-out paradigm. The new team-based paradigm is a salon/spa with a full appointment book that provides security and growth opportunities for employees.
FACT: You can’t create and provide career paths for your employees when you’re busy working your own column on the appointment book.
- It’s about creating something of value: The primary reason you buy a home is to build equity versus paying rent. It’s no different starting or buying a salon/spa. You want to grow it into something of value. Why? Because one day it will be time to sell and cash out. But as we all know, the resale value of a typical salon/spa is pretty uninspiring. Then why the heck bet damn near everything you own … and years of hard work … into a business that has little value when it’s time to sell? It’s sad to see how many owners waste too much time paying attention to everything but the value-creation aspect of owning a business … until it’s too late. Today, business ownership is intense and unforgiving. It’s hard work leading five, 50 or 500 employees on a full-time basis let alone a few hours or days a week.
FACT: The more time you spend servicing clients, the less time you spend creating value to your business.
Here’s my challenge to you: I’m not suggesting that you stop working on clients and give up the creative and technical side of your career. What I am suggesting is that you seriously evaluate how you will meet the business and leadership responsibilities of the company you own based on the six undeniable facts you just read.
If you need the fulfillment of doing creative and technical work … then allocate time to get that fulfillment.
For you, maybe that’s a day or two a week … or just a few hours.
Maybe it’s time spent training new talent and sharpening the skills of your experienced staff.
Maybe, just maybe … you’re ready to lead your company full time. It’s a process.
Whatever you decide, it will take time. If you want to build the company of your dreams … this is your path.
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