Latest / Salon Success Secrets — The podcast for salon owners who are done hustling harder and ready to break their revenue ceiling. / Beat The Recession By Building Your Own Economy

Transcript

Beat The Recession By Building Your Own Economy · Salon Success Secrets — The podcast for salon owners who are done hustling harder and ready to break their revenue ceiling.

• 0:33
  Speaker 1: Well, if you have been around the world for more than five minutes, you have heard somebody talk about the economy, and so we are excited to dive into today's episode, where we are going to be talking about how you can beat the recession by building your own economy.
• 0:51
  Speaker 2: Yeah, and you know, if you're on social media and you're in some Facebook groups or salon owner groups and like that's like the topic of conversation.
• 0:59
  Speaker 2: I even ran into an old employee that switched over to Booth Rant probably seven or eight years ago and that was the topic of her conversation too is like hell.
• 1:09
  Speaker 2: But what are we supposed to do now?
• 1:10
  Speaker 2: The economy is so bad, People are extending their appointments, they're not buying as much retail, and so today we're going to look at it from the lens of what would it be like if you can build your own economy so even in times of downturn, like you, can still survive and thrive.
• 1:28
  Speaker 1: Yeah, you know, because I think the key here is that the economy may affect you, but your economy will impact you.
• 1:39
  Speaker 1: And so how do you create an economy where you're not as influenced by the outside world's economy?
• 1:49
  Speaker 1: And so I think, to us, recession is when your neighbor loses their job, but then depression is when you lose yours, and so how do we um really set up an economy to where we're not worried about losing our own?
• 2:05
  Speaker 1: Um and you know, we can also help build that bridge to where, you know, maybe you can even build something so great that you're you're not even worried about your neighbor losing theirs Cause, uh, you know, I think when enough people get headed in the right direction and really can start to uh deliver massive value and make some great change in the world, um you're not as impacted by um just the highs and the lows of what the economy does.
• 2:34
  Speaker 2: Yeah.
• 2:34
  Speaker 2: So before we even dive into what can you do about the economy, let's first look at the words recession and depression.
• 2:41
  Speaker 2: So you know the definition of recession is a significant period of economic decline from the peak to the through of the business cycle, characterized by decreasing output and then by rising unemployment.
• 2:56
  Speaker 2: So when you think about recession, like yes, we're probably seeing a little bit of that in our economy right now.
• 3:01
  Speaker 2: When you think about depression, which Lindsay was saying earlier, you know depression is a period of drastic economic decline characterized by decreasing output, falling prices and rising unemployment.
• 3:15
  Speaker 2: And what happens a lot of times is we start to people, we start to hear people have these conversations and then it becomes our story of like oh my gosh, this is happening and we're not saying this isn't happening at all.
• 3:25
  Speaker 2: Like the more of a solid foundation and ecosystem that you can build in your salon, the more success you will have when we are in a recession type framework.
• 3:37
  Speaker 1: You know, and I think some some key things to note here are you know just how does this relate to salon owners?
• 3:43
  Speaker 1: Because you know, specifically when there's a downturn in the economy, some different things that you can see are, you know, maybe you start seeing fewer clients, or they reduce their spending on services, or they they spread out their appointment times.
• 3:57
  Speaker 1: You know, whatever those things might be, that you start to see less of.
• 4:02
  Speaker 1: You also have to realize, like this is also a time where people want and need those services more than ever.
• 4:09
  Speaker 1: You know, because, like, if somebody is starting to feel some of those pains of recession or depression, um, you know which recession is.
• 4:19
  Speaker 1: You know depression is like obviously, a more drastic, longer period.
• 4:23
  Speaker 1: More people are impacted and affected.
• 4:24
  Speaker 1: So, you know, recession is kind of like what would kickstart something like that.
• 4:29
  Speaker 1: But so what we can do, you know, is just is really start to focus in on like hey, you know, instead of instead of automatically jumping into that mindset of like people are spending less or doing all this stuff less, like starting to realize like hey, they need me more and and really start to see like, okay, what are some parts that I can control and and and start to impact, but then just noticing like hey, pay attention to your numbers, Like just see what's happening, because that can once you, once you unveil what's happening, that can start to kind of create that path for the future.
• 5:05
  Speaker 2: Yeah, and so we've been talking about economy.
• 5:07
  Speaker 2: So let's look at the definition of economy.
• 5:08
  Speaker 2: We're giving you all the best definitions ever.
• 5:11
  Speaker 2: If you ever want to look up a word, multiple heritage dictionary is one of our favorites.
• 5:14
  Speaker 2: When you look at the word or the definition of economy, it says the system of production, distribution and consumption of goods and services.
• 5:21
  Speaker 2: So when you think about that, there's always going to be a micro economy and a macro economy.
• 5:27
  Speaker 2: So your macro economy that's the big picture, like that's the global national economies and you know how external factors, like recessions, can truly impact that.
• 5:36
  Speaker 2: So like, if you're seeing a recession, that's my macro, like everyone is being impacted more.
• 5:42
  Speaker 2: In a micro economy, you know this is going to be more smaller, more personal economic space.
• 5:46
  Speaker 2: So this would be like in your hometown, in your area, and so like, when you think about that micro economy, like that's where you have more control of yet things may be happening outside of you, but when you're really able to dial into, you know, building that loyal clientele, offering services and understanding your numbers, like Lindsay was saying, managing your financials like that's when, even when a macro economy is not doing well, you can still have control of that micro economy.
• 6:12
  Speaker 1: Yeah, and you know, I think a good way to look at that too, jen, is just like even thinking about like micro economies, like sometimes like there's like a big distribution center in a smaller town or something, for example, and if they go out of business, you know, a lot of people can lose their jobs in that community, and so that really does affect the micro economy.
• 6:31
  Speaker 1: And you know, kind of what we're seeing right now is the macro economy is kind of being impacted just by the rise of prices.
• 6:37
  Speaker 1: Right now is the macro economy is kind of being impacted just by the rise of prices.
• 6:42
  Speaker 1: You know, obviously 2020, there's a lot of different factors that kind of go into this.
• 6:45
  Speaker 1: But so so thinking like, hey, these things might be happening in the macro economy, but in your micro economy, in your town, you know, hopefully you're still seeing some stabilization and all of that good stuff, and so so really, that's exactly what Jen was saying you have control over that micro economy.
• 7:04
  Speaker 1: It doesn't matter what's happening in the world per se, but it does matter the impact that you want to make.
• 7:11
  Speaker 1: You know about the things that you are in control of, you know.
• 7:15
  Speaker 1: And so I think, when you think about what you're in control of and you're in building your own economy and in your micro economy is.
• 7:23
  Speaker 1: You know you always have control over building things like your client relationships You're going to always have control over.
• 7:30
  Speaker 1: You know working on your team productivity.
• 7:33
  Speaker 1: You know offering some unique offerings, like really dialing into what it is that you do have control over, because you don't have control over the world.
• 7:43
  Speaker 1: If you did, that would be great, like we can probably sprinkle some amazing things in there and make some magic happen.
• 7:48
  Speaker 1: You know, but like you do have control over that macro economy and micro economy and specifically, if you really dial that micro and even further, you do have control over what's happening inside of your walls and so you can set up that context and and start to create your own ecosystem so that you can build something amazing.
• 8:09
  Speaker 2: Yeah, and you know, I just love, like when you think about being a salon owner too, because if you have a large database, or even if you don't, like, there's still people in your database that you haven't served in a while.
• 8:20
  Speaker 2: So, like, a lot of times when we go through a recession, people will, like, pump the brakes on marketing and, like I like to look at it through the lens is like this is the time to dial up, like, turn it up, let's pump it up.
• 8:30
  Speaker 2: It's time to turn up the marketing.
• 8:32
  Speaker 2: And so, like, you can turn a marketing without even spending a lot of money just by using the database that you have.
• 8:37
  Speaker 2: And so some things that we've done in our salon, too, is like really nurturing the guests that we haven't seen in 90 to 180 days, you know, doing a drip campaign to give them so much value and to love on them and to share knowledge on them that they're not getting anywhere else, that you know, in turn, when they are able to get into the salon or when they're ready to get in the salon, we're going to be top of mind for them.
• 8:58
  Speaker 2: Um, you know other ways to nurture, like if you guys have, uh, if you are members of maya, which is meet your uh stylists or meet your artists I know a lot of salons do that where it's a matchmaking quiz which takes a consumer, matches them with, like the three top stylists in your salon.
• 9:12
  Speaker 2: Like right now they were getting one email.
• 9:15
  Speaker 2: Now we've been able to, like create a series of drip campaigns to nurture them, like a seven email campaign where we're giving them value, we're talking about the biggest mistakes that people make with their hair and skin, and so like.
• 9:27
  Speaker 2: When you're in this recession, this is the most perfect time that you can really amp up your marketing and give so much value that you'll see that value return on you.
• 9:36
  Speaker 2: 10 X.
• 9:38
  Speaker 1: Yeah, you know, and, jen, I think this is what's cool when we do start to see some shifts like this instead of the economy, is that a lot of times, you know people that have been in you know booth rental situations or small salon situations start to look to get back to um, a larger salon company like you know, the ones that we serve that are part of salon business school and the PhD program.
• 9:57
  Speaker 1: Um, you know, mostly just because, like, you do have that large client base and you are spending your time and efforts on marketing, because I think there's a stark difference between, you know, loving on someone, giving them value, versus you know, I got on Snapchat not long ago and I saw a stylist posted a picture of their receipt and was like, I just spent $600 at the beauty supply store.
• 10:19
  Speaker 1: You know, and, um, you know, as a consumer, if you were to see marketing like that, you would be so confused, you know you'd be like okay, is that a lot of money?
• 10:29
  Speaker 1: Is that not a lot of money?
• 10:30
  Speaker 1: Like, um, am I supposed to feel sorry for them?
• 10:33
  Speaker 1: Like, how am I supposed to even feel when I see this?
• 10:35
  Speaker 1: Like it just creates a lot of confusion?
• 10:37
  Speaker 1: And so, you know, a lot of times like, um, people who are in those situations where it's just them, they don't, they're not surrounded by anybody who can help them see a bigger picture and and and be resilient in times like this, cause this is really where resilience, you know, is your best friend.
• 10:55
  Speaker 1: Um, you know, and we do start to see some of those shifts, like people are wanting to get back into those commissioned salon environments because they start to see, like, all of the value that they get in being in a team based environment.
• 11:07
  Speaker 1: Like that, you know, and so I think that's also just a great thing.
• 11:11
  Speaker 1: You know, even just talking about that Maya survey, you know, when you're looking to nurture those guests, like inviting them, like, hey, you know, um, are you looking to break up with your hairstylist?
• 11:23
  Speaker 1: That's an email that, uh, we just recently sent out, um, and truly, you know the.
• 11:28
  Speaker 1: The.
• 11:29
  Speaker 1: The thought process behind that was that, like nobody owns clients, like we want to earn your business all of the time, like here are, you know, like you have free reign to see anyone you want to, and you know we have tons of amazing artists here and we would love for you know, like, you have free reign to see anyone you want to and you know we have tons of amazing artists here and we would love for you to, to get connected to our team and really for them to start to feel supported by more than just one artist inside of your business.
• 11:51
  Speaker 1: I think is key.
• 11:51
  Speaker 1: And so looking to create some systems like that inside of your business right now, you know, if you're feeling impacted by the economy in any way, how do we become an even stronger team?
• 12:01
  Speaker 1: Because you know this is when, like this is when those are the people who make it and make millions.
• 12:08
  Speaker 1: On the other side, like this is the investment phase.
• 12:10
  Speaker 1: A lot of people get scared, like you were talking about Jen and dial back on their spinning with marketing and all these things, but this is where you dial in even more and this is where you come out stronger and even more incredible on the other side.
• 12:22
  Speaker 2: Yeah, you know it's so crazy that you said that, lens, because I was just.
• 12:26
  Speaker 2: I saw someone that used to work for me.
• 12:28
  Speaker 2: She worked for me for a long time 10 years.
• 12:30
  Speaker 2: Great person, still great friend, and she's been.
• 12:33
  Speaker 2: She's been in industry probably almost 20 years.
• 12:35
  Speaker 2: She's been on her own for about seven or eight years and I ran into her and she's like I'm ready to get back into a commission salon and so you know, when you are surrounded by a healthy environment, that's positive.
• 12:47
  Speaker 2: That's talking about how can we make the best with what we have and how can we serve to a different degree, like people that are in a booth, rent or suite situation no judgment but like they don't have all those tools.
• 12:58
  Speaker 2: So like this is the time, I think, commission salons really get to shine and really get to do some even more incredible things with clients.
• 13:07
  Speaker 1: Yes, I love that.
• 13:08
  Speaker 1: So let's talk about what are some action steps that you can take right away to really start building your own economy.
• 13:16
  Speaker 1: And so, you know, I would say step one would be to just really focus on increasing your client's retention.
• 13:20
  Speaker 1: And so, you know, I would say step one would be to just really focus on increasing your client retention.
• 13:23
  Speaker 1: And so, if you've never looked at like your new guest retention or your existing guest retention, go ahead and pull up that number.
• 13:29
  Speaker 1: An industry statistic would be 25% of new guests return into the inside of your salon.
• 13:36
  Speaker 1: And so just see where you're at.
• 13:38
  Speaker 1: You know, just use it as a thermometer.
• 13:39
  Speaker 1: If you're at 20%, no judgment.
• 13:41
  Speaker 1: If you're at 40%, that's great.
• 13:43
  Speaker 1: What could we do to make it even better?
• 13:46
  Speaker 1: If you know, and so you can really start to dial in on what does your experience look like with that guest from start to finish.
• 13:54
  Speaker 1: What are some things that you can do to kind of amplify the service that you're giving or the experience that they are receiving even more?
• 14:01
  Speaker 1: The service that you're giving or the experience that they are receiving even more?
• 14:04
  Speaker 1: How can you engage more teammates in to to increase that loyalty?
• 14:07
  Speaker 1: You know, because people love to feel loved on by multiple people.
• 14:10
  Speaker 1: Like if you go into a business and you know one person, that feels great.
• 14:13
  Speaker 1: But if you know multiple people, they know you by name, like you're like a client for life, you know, and so, like, how can we create that inside of our business?
• 14:21
  Speaker 1: You know, this morning I just ran into somebody that I hadn't seen for a little while and I said, you know, thank you so much and enjoy, you know, getting your hair done today.
• 14:29
  Speaker 1: And she was like, you know, I wouldn't go anywhere else.
• 14:32
  Speaker 1: Like, what you guys are building here and what you do as a team together is incredible.
• 14:37
  Speaker 1: And, you know, I just wouldn't want to spend my time or energy anywhere else and I just thought that is so cool to see.
• 14:43
  Speaker 1: You know, because I looked at her history then after she said that and she'd seen multiple service providers you know, some that are still with us, some that you know have moved on to other opportunities and just for her to recognize, like, hey, this is the environment that I want to be a part of, lets me know.
• 14:58
  Speaker 1: Like, hey, our, you know, efforts in building that client retention are working, and so what can we do to make it even better if you know so.
• 15:06
  Speaker 1: Sometimes it's like loyalty programs or you know a reward system for referrals, you know whatever that might be.
• 15:11
  Speaker 1: Just really dial in on how can you increase that client retention?
• 15:17
  Speaker 2: I love that.
• 15:17
  Speaker 2: Another action step to take is to communicate things with your team.
• 15:21
  Speaker 2: You know they're watching the news, they're seeing social media, they're freaked out because all they hear is everybody's losing their job, there's no money, there's no this, there's no that, and so, like like yesterday at our salon celebration, like we truly cleared the word economy and then we also just looked at hey, this is what we have in place to help build our ecosystem, this is the database we have, these are the new technologies we're putting into place, this is how we're nurturing more guests.
• 15:44
  Speaker 2: And you could just feel like, you know, some of them were so kind of tight when you even start mentioning the word economy that their bodies just kind of loosened up because they knew that we have a plan in place.
• 15:54
  Speaker 2: And so I think it is very valuable to communicate with your team the plan that you have in place, that's how you have control of that micro economy, that's your economy, so that they get enrolled and can help make everything better too.
• 16:09
  Speaker 1: Yes, and you know.
• 16:10
  Speaker 1: Another step that you can take is just to start to build some financial resilience.
• 16:14
  Speaker 1: You know, and so, really, you know, looking at how you can manage your cashflow, you know, coming up with some sort of like a savings plan but also still continuing to invest in your salons growth, you know.
• 16:27
  Speaker 1: So the last thing that you want to do is cut back on every single thing.
• 16:30
  Speaker 1: Like you know, there are so many things that you can do that don't cost you a dime.
• 16:35
  Speaker 1: You know, like learning each guest's favorite drink, you know, like, uh, when they know that they're going to be greeted with that, like when they come in, man, they feel special.
• 16:46
  Speaker 1: Or looking up people on social media before they come in, just to really get to know their name so that when they come in, you can say hi, jen, welcome back, it's great to see you.
• 16:55
  Speaker 1: You know, we've been looking forward to your visit.
• 16:57
  Speaker 1: People need that love and connection more than ever right now.
• 17:01
  Speaker 1: And that's free and it doesn't cost you a dime.
• 17:03
  Speaker 1: You know, and so, but looking for ways to build that financial resilience is huge Monitoring your, your key performance indicators, seeing you know kind of what that cashflow is doing, and then just having some sort of a savings plan, um, you know um, and just having that, that forward thinking mindset in place right away can really help you be feel like you're in a good spot through anything.
• 17:29
  Speaker 2: I love that, yeah, because a lot of times we tend to live in fear.
• 17:31
  Speaker 2: At this moment, just working with one of my commercial tenants, like their sales are down and they want to start cutting employees.
• 17:37
  Speaker 2: Cutting employees, I'm like just an idea would be instead of cutting employees, let's pump the brakes and let's look at your sales process, let's see how we could improve your sales process.
• 17:45
  Speaker 2: And so I think we, if you live in that place of fear, like your micro economy is going to come crumbling down, micro economy is going to come crumbling down, and so, like we just really invite you to to understand, like, what is recession, what is depression, what is economy, and how, what are you doing?
• 17:59
  Speaker 2: Um, to you know, really have ample opportunities to create your economy, not just the economy.
• 18:06
  Speaker 1: I love that.
• 18:07
  Speaker 1: So, um, if you've gotten some amazing value out of today, please share it with one of your salon owner friends.
• 18:12
  Speaker 1: We would love to meet you or hear from you.
• 18:14
  Speaker 1: You feel free to email us, hello, at salon business schoolcom.
• 18:18
  Speaker 1: Um, you know, and just start taking a step today, you know, communicating with your team, whatever that next step for you might be, because the economy may affect you, but the economy you build will define your future.
• 18:33
  Speaker 1: So keep building it strong.