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Chapter 32 The Salon Business
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Being both a great artist and a successful business person=
The greater you chances of success Entire books have been written Following information is a general overview Weymouth.ac.uk
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Become your own boss: Owning your own salon Booth rental-not legal in PA. See “Did you know?”
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Beautyschoolsdirectory.com Salonbootcamp.com Discoveryspas.com
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Opening your Own Salon Huge undertaking *financially *physically *mentally Face challenges that are complex and unfamiliar
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Kqtv.cityvoter.com Thehairem.biz
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before opening your doors decide:
*what products to carry *what types of marketing and promotions *best methods and philosophy for running the business *whom to hire Consider the following basic issues and perform basic tasks
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Create a Vision and Mission Statement for the Business Goals
Vision Statement: long-term picture of what the business is to become and what it will look like when it gets there Mission Statement: description of the key strategic influences of the business *market it will serve *services it will offer *quality of those services
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Goals: set of benchmarks that help you to realize your mission and your vision
Set short-term and long-term goals for the business
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Create a Business Timeline
Year One: *determine and complete all aspects of starting the business Years Two-Five: *tending to the business, its clientele, employees for growing and expanding
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Years Five-Ten-if successfully achieved:
*Add more locations * expand the scope of the business *construction of larger space Years Eleven to Twenty: *move from being a working cosmetologist into a full-time manager
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Years Twenty Onward: *consider selling or *changing it in some way (junior partner)
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Garysplacesalons.com
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Kristirushing.com Brightonlife.com B2salon.com
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Determining Business Feasibility
Means addressing certain practical issues *do you have a special skill or talent? (sets your salon apart) *does the town offer the type of clientele you want (products and services you want to offer)? *how much money is needed to open? *is funding available?
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Choose a Business Name The name: *explains what it is *identify characteristics (sets apart) *influences how clients perceive the business *creates a picture in client’s mind
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Colourtube.com Behindthechair.com
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Choose a Location Good visibility High traffic Easy access Sufficient parking Handicap access
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Written Agreements Many written agreements and documents needed *leases *vendor contracts *employee contracts *and more
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For legal purposes *who does what *what is given in return Must be able to read and understand them
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Business Plan written description of your business ~today ~future
Agreement with yourself-not legally binding However, needed to obtain financing
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Look at printed business plan document from Epiphany Salon
Blogs.nailsmag.com
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Includes description: ~business ~services provided ~demographics
*race, age, income, educational attainment ~salaries and benefits ~pricing structure Interstellar-solutions.co.uk
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Expenses ~equipment ~ supplies ~ repairs ~ advertising ~taxes ~insurances ~projected income and overhead expenses
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Business Regulations Laws
comply with all local, state, and federal regulations and laws contact local authorities ~business licenses ~other regulations *zoning *business inspections
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Comply with all federal Occupational Safety and Health Administration (OSHA)
Manufacturer’s Safety Data Sheets (MSDS)
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Insurance must purchase insurance ~malpractice ~property liability ~ fire ~burglary ~ theft ~business interruption
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disabilities policy Safety manual.com Oemeyer.com
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Salon Operation Running of the business Record Keeping Maintain accurate and complete records of all financial activities Salon Policies Rules and regulations Everyone is treated fairly and consistently
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Individual ownership: Make your own rules
Types of Salon Owners Individual ownership: Make your own rules Meet all duties and obligations of running a business Sole proprietor is the owner and manager determines policies assumes expenses receives profits/bears all losses Blogs.nailsmag.com
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Salonsachet.com Socialmiami.com
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Partnership more opportunity for increase investment ~growth can be magical or a disastrous Ex. Urban Edge John Paul Mitchell Systems
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Partnership: Two or more people (not always equal) ~more capital or money ~pool skills and talents ~share work ~responsibilities ~decision-making ~must assume one another’s liability or debts
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John Paul DeJoria Paul Mitchell Paul mitchell.com Urbanedge.boomtime.com
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Corporation: ownership controlled by one or more stockholders
Incorporating *protects your personal assets *saves money in taxes *greater business flexibility *makes raising capitol easier
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Characteristics of corporations:
Raise capitol by issuing stock certificates or shares Stockholders-has ownership interest Sole stockholder or many stockholders
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Meetings required to maintain corporate status
Income tax is limited to the salary you draw-not the profits Costs more to set up *formation fees *filing fees *annual state fees Required to pay unemployment insurance taxes on salary (sole proprietor or partner do not)
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Ex. Great Clips Haircuttery
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Strmsigns.com Haircuttery.com
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Franchise Ownership Contractual relationship Operating under the franchisor’s trade name in exchange for a fee Under the franchisor’s guidance and stipulations
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Advantages: Known name and brand recognition Franchisor does most of the marketing Protected territories
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Concerns: Agreements in what you can and cannot do Be sure to research Have a attorney read the contract/explain Must pay the fee (successful or not)
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clickedbmx.com thelifeofrylie.com
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Business Plan Includes: Executive Summary Vision Statement Mission Statement Organizational Plan Marketing Plan Financial Documents Supporting Documents Salon Policies
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Purchasing an Established Salon
excellent opportunity/look at all sides of the picture Seek professional assistance from an accountant and a business lawyer
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Agreement should include:
Financial audit *actual value of the business *may not retain all of the former owner’s clients without help from former owner written purchase sale agreement
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complete and signed statement of inventory
~value of each article initiate an investigation ~default in the payments of debt identity of owner
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Use of name and reputation for a definite period of time
Disclosure of all information ~clientele ~purchasing ~service habits Disclosure of conditions of the facility
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Noncompete agreement- seller will not work in or establish a new salon within a specific distance
Employee agreement-will the employees stay with the business
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Drawing up a Lease your own business ~not always the building Rent or Lease-specify clearly ~who owns what ~who is responsible for repairs and expenses
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Secure the following: exemption of fixtures or appliances
~can be removed without violating the lease agreement about necessary renovations and repairs option to allow you to assign the lease to another person
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Protection Against Fire, Theft, and Lawsuits
Have adequate locks Fire alarm system Burglar alarm system
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Purchase: ~liability ~ fire ~malpractice ~burglary insurance
Professionalandliability.com Saloninsurance.com
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all laws cosmetology ~safety and infection control codes/city/state keep accurate records of everything!! Ignorance of the law is no excuse for violating it
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Business Operation Need: ~excellent business sense ~ aptitude ~good judgment ~diplomacy
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~sound business principles
~circle of contacts *local entrepreneur group *Chamber of Commerce
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Quakertownalive.com
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Smooth business management:
Sufficient investment capital Efficiency of management Good business procedures Strong computer skills Cooperation between management and employees
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Trained and experienced personnel
Pricing of services Review price list “starting at” Review expenses chart (next page)
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Mojazzhair.com Paulzoom.com
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know where your money is being spent
Allocation of money know where your money is being spent accountant and accounting systems are indispensable Business-services.upenn.edu Tutorsonnet.com
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The Importance of Record Keeping
simple and efficient record system necessary regarding taxes and employees record all income and expenses retain check stubs, cancelled checks, receipts, and invoices
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Appliance-repair.org Webdatamation.com Scottstadel.com Knowfree.net
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Purchase and Inventory Records
help maintain inventory ~ preventing overstock ~shortage of supplies alerts you to theft shows net worth
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keep running inventory
~use and retail value used daily ~consumption supplies sold to clients ~retail supplies
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Service Records keep client cards ~treatments given ~merchandise sold Include: name, address, date, fee charged, products used, results obtained, preferences and tastes
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Operating a Successful Salon
take excellent care of your clients physically attractive well-organized smoothly run sparkling clean
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Planning a Salon’s Layout
best physical layout ~salon you envision maximum efficiency
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low-budget ~several stations ~small to medium sized reception area ~small retail area (clients may not have money to buy products)
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High-end salon or luxurious day spa
~ expect higher quality of the service ~matched by the environment ~more room in waiting areas coffee bars
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private areas for clients to conduct business (phone, laptop)
retail area ~spacious ~ inviting ~well lit
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layout is crucial advice of an architect professional equipment and furniture supplier are good resources
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Create small salon or renovate existing space
Keep plumbing in same area Electrical wiring up to code Get everything in writing from contractors, design firms, manufacturers, and architects Get more than one quote It takes about 6 months for a new salon to operate at full capacity-have $$$
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Personnel size of salon/size of staff large salons require “specialists” receptionists, hairstylists, nail technicians, shampoo persons, colorists, massage therapists, estheticians, hair removal specialists smaller salons ~personnel perform more than one type of service
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Interviewing potential employees:
level of skill personal grooming image as it relates to the salon overall attitude communication skills
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good hiring decisions is crucial
bad hiring decisions ~ painful ~more complicated
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Payroll and Employee Benefits
successful business=everyone feels appreciated and happy share your success when financially feasible meet your payroll obligations offer benefits schedule employee evaluations
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create and stay with a tipping policy i.e. stylists tip assistants
put pay plan in writing create incentives ~earn more money ~ prizes ~tickets create salon policies and stick to them
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Managing Personnel make a positive impact on lives and their ability to earn a living learn how to manage other people Learn what you can and cannot say when hiring, managing or firing
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Be familiar with civil rights laws
*Equal Employment Opportunity Commission (EEOC) *Americans with Disabilities Act (ADA) Have a written personnel policies and procedures manual Every employee must read and sign it
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The Front Desk “operations center” employ professional receptionists ~handle the job of scheduling appointments ~greeting clients
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The Reception Area first impressions count attractive, appealing, and comfortable ~receptionist ~retail merchandise ~ phone system ~business cards ~displayed price list
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The Receptionist second in importance Well-trained first person the client sees ~pleasant ~ greet each client with a smile ~address each client by name
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Tiffanyplacesalon.com
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Efficient, friendly service fosters good will, confidence,. and
Efficient, friendly service fosters good will, confidence, and satisfaction duties include: ~role of greeter ~answering the phone ~booking appointments ~inform the stylist client has arrived
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~preparing daily appointment information
~recommending additional services ~through knowledge of retail products ~salesperson and information source for the clients
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~straightens up the area
~maintains inventory ~daily reports
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Booking Appointments most important make the most efficient use of everyone’s time client should not have to wait for a service stylist should not have to wait for the next client
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each person should know:
*how to book appointment and how much time is needed for each service pleasing voice and personality
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appearance that conveys salon image
knowledge of various services ***all services, cost, and time they take unlimited patience with both clients and salon personnel
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Appointment Book helps stylists arrange time to suit their clients’ needs computerized system actual hardcopy
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Smartsalonmanagement.com
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Use of Telephone in the Salon
good habits and techniques increase business improve relationship with clients and suppliers
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Good Planning Business calls to clients and suppliers ~quieter time of day ~quieter area pleasant voice
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use correct grammar speak clearly “smile” show interest or concern be polite, respectful, courteous be tactful
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Incoming Telephone Calls
lifeline of salon Clients: ~call ahead for appointment ~call to cancel ~reschedule appointment
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*use good manners “Good morning” Salon name “May I help you?” “Thank you” Answer phone promptly
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If you do not have information…
~put client on hold ~get information ~offer to call back with info Do not talk to client in room while speaking with someone on the phone
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Booking Appointments by Phone
record full name, phone number, service booked confirm appointment one-two days before
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Be familiar with: ~services ~products ~costs ~what stylists perform specific services-color correction
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be fair **exception-requests When client requests an unavailable stylist: Suggest other times Suggest another stylist Put on cancellation list
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Handling Complaints by Phone
difficult task respond with self-control, tact and courtesy tone of voice sympathetic and reassuring and concerned try to resolve quickly and effectively
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Building Your Business
includes all activities that promote the salon favorably attract and hold the attention a satisfied client is the very best form of advertising develop a referral program hire a small local agency
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advertising budget should not exceed 3 percent of your gross income
plan well in advance know what you are paying for get everything in writing know your clientele-which type of media they use what kind of messages attract them
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Newspapers Yourhometownportal.com *ads, coupons, coupon book
Direct mail Classified advertising *yellow pages Yourhometownportal.com
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e-mail newsletters/discount offers
Web site offerings Giveaway promotional items *combs, emery boards
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Window display *attracts attention Radio Television Allaboutjazz.com
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Flikr.com Springfieldnebraska.com
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Acelham.co.uk Maurohair.com
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Community outreach *public appearances, women’s and men’s clubs, church functions, political gatherings, charitable affairs, bridal fairs, fashion shows, radio and TV talk shows
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Sierramadrenews.net Fccc.edu
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Client referrals In-salon videos
Follow up every visit to determine client’s satisfaction Personally contact any client that has not been in the salon for more than eight weeks
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Selling in the Salon financial success revolves around ~sale of additional salon services ~take-home/maintenance products adding services or retail sales *means additional revenue
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Smartfurniture.com Merchantcircle.com
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Beauty professionals feel uncomfortable selling products and additional services
Overcome this feeling Sales professionals make customer care their top priority Offer good advice
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Etopa.com Eqgroup.com
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Seattlepi.nwsource.com Amazon.com
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