Latest / Salon Success Secrets — The podcast for salon owners who are done hustling harder and ready to break their revenue ceiling. / Crafting the Ultimate Salon Business through Financial Wisdom and Team Synergy

Transcript

Crafting the Ultimate Salon Business through Financial Wisdom and Team Synergy · Salon Success Secrets — The podcast for salon owners who are done hustling harder and ready to break their revenue ceiling.

• 0:34
  Speaker 1: Welcome.
• 0:35
  Speaker 1: It's great to have you joining us.
• 0:36
  Speaker 1: Today.
• 0:36
  Speaker 1: We are going to be diving into what all does it take to run a successful salon business, because we know, up until this point there hasn't been a salon business school.
• 0:48
  Speaker 1: We are proud to be offering an amazing way for people to take their salon businesses to the next level.
• 0:55
  Speaker 1: So if that's you you want to be taking your business to the next level, you are on the right podcast today.
• 1:01
  Speaker 2: Awesome, and salon business school was developed for salon spawners just like yourself, because we've been.
• 1:07
  Speaker 2: Where you're at is like, hey, we've got this art, we've got this talent at doing hair.
• 1:12
  Speaker 2: But we need some support on the business side because at the end of the day, they are two totally different games to play.
• 1:17
  Speaker 2: So truly understanding, if you're going to be a service provider, how to do that really well, but also, if you're going to be a business owner, how to do that even exceptional and grand, and how to make really incredible things happen in your life.
• 1:30
  Speaker 1: Yes, and so we know there are 12 major areas inside of a salon that we need to be focused on as the steward of the ship, and today we're going to be diving into three that we know are super important parts of your business.
• 1:49
  Speaker 1: We believe all 12 are as well, but we're just going to take a peek at three today to just see like, hey, when we nail three of these areas, the magic that we can create inside of our business is just amazing.
• 2:04
  Speaker 2: So one of those first areas drumroll please.
• 2:07
  Speaker 2: One of my favorite areas is the looking at a profit and loss.
• 2:12
  Speaker 2: And you know I remember my first profit and loss.
• 2:15
  Speaker 2: It was handwritten on a piece of paper.
• 2:17
  Speaker 2: I actually found it not so long ago.
• 2:18
  Speaker 2: I was like, wow, this is really interesting.
• 2:20
  Speaker 2: And so to really understand, like how to be able to make informative decisions on your business and what your areas of opportunity are, you really want to paint a crystal clear picture of having a profit and loss where you analyze it, where you really truly understand, hey, what's it going to take to make this business succeed?
• 2:39
  Speaker 2: And you know there's a saying that says sales is for the show, profit is for the for the dough.
• 2:46
  Speaker 2: And so really understanding that is really powerful.
• 2:51
  Speaker 1: Yes, and you know, if you're a super creative minded person and you're thinking, oh my gosh, they're talking about a profit and loss statement right now, I'm allergic.
• 3:00
  Speaker 1: I'm going to check out all of those things, don't just stick around, because you know what we've.
• 3:05
  Speaker 1: What we've discovered is when we're able to confront exactly what is going on and confront just means to be with when we're able to be with our numbers and see the story that they're telling us.
• 3:17
  Speaker 1: That's when we're able to rewrite the ending.
• 3:19
  Speaker 1: You know.
• 3:20
  Speaker 1: That's when we're able to rewrite what happens next and create an amazing future for our teams and for everybody inside of the company, the salon owner included.
• 3:32
  Speaker 2: So the one hot tip on your profit and losses you want to make sure that your cost of goods sold does not exceed 60% of your total income.
• 3:41
  Speaker 2: When we work with salon owners, we really want to make sure that we get into that red light, stop light, like we're going to take a pause and really explore here, because a lot of times we find that if you don't have any profitability or that your profitability is really low, that your cost of goods sold is usually taking more than that 60%.
• 4:02
  Speaker 1: Yeah, you know, and we've worked with hundreds of salon owners across the nation, and one thing that we have discovered is this is the key area that keeps a lot of people stuck is when they're operating above that 60% mark with the cost of goods sold.
• 4:18
  Speaker 1: You know, we've even seen salon owners in the past that, have, you know, tried to duplicate a space without getting this under control first, and really what you're duplicating is just chaos.
• 4:31
  Speaker 1: And so we know, hey, if your future plans include opening multiple locations or you know anything, any sort of growth, we know that you need to nail this cost of goods sold and get everything just set up easy inside your profit and loss statement.
• 4:50
  Speaker 1: So, whether you're working with an accountant or a CPA or whoever's, you know, in addition to you with your numbers, you can easily just go in, pull a report and see the immediate health of your company.
• 5:04
  Speaker 1: And you know, when you have this number in the P&L under control, that just it's going to be easy.
• 5:12
  Speaker 1: You know things are going to flow a lot smoother.
• 5:14
  Speaker 1: You're not going to be feeling like you're rollercoastering inside of your business.
• 5:19
  Speaker 1: You're going to know that you're on that upward spiral.
• 5:22
  Speaker 1: And so there's, you know, a couple of different areas to look at and start the P&L, but we know for sure that that's the one thing.
• 5:29
  Speaker 1: If you can nail that, hey, you're on that upward spiral for sure.
• 5:35
  Speaker 2: Love that, landon.
• 5:35
  Speaker 2: So you're probably thinking well, what goes into our cost of goods sold?
• 5:40
  Speaker 2: So just a few things that we look at, especially when we're inputting your numbers into our Excel sheet, is would be you know your, your retail products, your back bar products, what it cost for you to acquire those every month, your merchant fees, your salon owner compensation, your service providers compensation and we do like to put trainees or if you have a training program, we put their pay in there as well, just to make sure that they are actually helping create that service or to see more guests.
• 6:13
  Speaker 2: So that's why we want to track that as well.
• 6:17
  Speaker 1: Yes, because you know, and this isn't even going to be one of the things that we're talking about today but when we get into the ladder booking section, we know that having those trainees inside of that, that cost of goods sold, we know what you can create for multiple people by having them be a part of that cost of goods sold.
• 6:37
  Speaker 1: So you would, you know, put front desk wages or salon, salon director or manager wages after cost of goods sold, because technically you don't need that to produce your good or to replicate goods, you know.
• 6:51
  Speaker 1: So this is what does it actually cost to produce a sale inside of your company, you know.
• 6:59
  Speaker 1: So that's why we include things like the retail costs, backbar costs, you know the producing, you know service provider producing wages inside of that as well, just to really get a clear snapshot of what exactly is happening inside of your company.
• 7:19
  Speaker 2: And you know why 60% is well, if you think about it, if you look at it from each dollar standpoint, if you're spending 60 cents per dollar already on your cost of goods sold, that only leaves you 40 cents left at the end of the day to pay the rest of your expenses.
• 7:35
  Speaker 2: And so once that goes above and you're 80% or 80 cents to the dollar is going to pay those cost of goods sold, that leaves you 20 cents left to you know her dollar to pay things like your rent, any benefits that you may have for your team.
• 7:50
  Speaker 2: So that's when the game gets tricky and that's usually when we want to pull out the red caution flag and say, hey, let's slow down, take a few steps back and see what we can really create here.
• 8:00
  Speaker 1: Yes, and so you know, really taking that blindfold off when you're driving this vehicle inside of your business can give you so much freedom.
• 8:11
  Speaker 1: And you know this is something that we know a lot of salon owners don't necessarily get into the to this salon owning game to really dive into numbers typically.
• 8:22
  Speaker 1: And so what we know is like when you do understand what's going on with those numbers, a lot of it is that nobody has ever broken it down for you simply before and you've never really understood, so it just looks like a foreign language.
• 8:37
  Speaker 1: When you look at a profit and loss statement or when you look at your numbers, you're like, okay, I either know it's working or it's not working, or it's somewhere in between.
• 8:45
  Speaker 1: But I don't really understand why.
• 8:47
  Speaker 1: And we know when you understand why, when you understand what's going on in there and it's in a simple language that you can understand you just walk away feeling so empowered and just what you can create next inside your business is amazing.
• 9:04
  Speaker 2: I love that lens because there's no judgment.
• 9:07
  Speaker 2: Ever when we look at a P&L, it's just opportunity.
• 9:09
  Speaker 2: And you know, I say there's no reason to judge because you don't know everything, and so really it just gives you a piece of freedom like Lindsay was saying to say, hey, this is where we're headed, this is what we need to do.
• 9:21
  Speaker 2: These are the changes we can implement to really create that stable business.
• 9:27
  Speaker 1: And so, you know, once you've kind of nailed down that profit and loss area, another area that we love to look at inside of Sloan Business School is marketing, and I think that a lot of Sloaners have a love hate relationship with marketing, and I think it's mostly because when we think of marketing inside of our industry, we think of, specifically, social media marketing.
• 9:49
  Speaker 1: And yes, that's one avenue.
• 9:50
  Speaker 1: You know, you can't totally ignore that avenue, for sure.
• 9:53
  Speaker 1: But we believe there's a lot of other areas to look at inside of marketing.
• 9:58
  Speaker 1: You know, and one of the key pieces that we talk about is, you know, there's a difference between, you know, let's say, like an organic post on social media versus, you know, a paid Google ad.
• 10:13
  Speaker 1: You know, it's almost like you've got your mall walkers that are just roaming the mall, just browsing around.
• 10:20
  Speaker 1: You know, those are the people that are hanging out on social media, but then you also have the people who are looking for a text, like they're looking for a salon.
• 10:30
  Speaker 1: They know exactly what they want, and those are the people that show up on Google.
• 10:33
  Speaker 1: And so there's a lot of other marketing areas that we uncover inside of this, but that's one of the main ones.
• 10:39
  Speaker 1: That, I think is a big misunderstanding inside of our industry, for sure.
• 10:44
  Speaker 2: I love that you said that, lindsay.
• 10:45
  Speaker 2: Yeah, during salon business school we definitely dive into the different types of buyers, because that's really an incredible teaching moment for your team as well Looking at it from a concert viewer a concert goer view and really being able to, when a guest comes in, understand their buying type, and that gives you all the tools of how to communicate with them.
• 11:07
  Speaker 2: And when your team understands the different buyer types and they understand what kind of buyer type they are, that helps to create a place of serving in a bigger way, because, at the end of the day, when you understand, that's when you have knowledge.
• 11:20
  Speaker 1: Yeah, and I think that that was something that the leaders that were on our leaders call our salons.
• 11:28
  Speaker 1: Inside of the full program, we've got the leader team as well that they can be a part of.
• 11:33
  Speaker 1: They were like, wow, I'd never even thought about that before.
• 11:36
  Speaker 1: I think as buyers, we think that every buyer buys exactly the same way that we do, and when our team and us as salon owners have a deeper understanding, we're able to serve people quicker.
• 11:51
  Speaker 1: It's easier, you feel more harmony or authentic with what you're doing, and so there's so many things that we uncover during that portion.
• 12:02
  Speaker 1: But I think understanding those buyer types like you were just talking about, jen, is key.
• 12:09
  Speaker 2: I also love marketing starts in-house as well as looking at your greeting.
• 12:14
  Speaker 2: That's marketing.
• 12:15
  Speaker 2: If you didn't even realize that, when there's consistency in that, hello Chick-fil-A, my pleasure.
• 12:21
  Speaker 2: That's when your marketing game is working.
• 12:25
  Speaker 2: So having a wow greeting when someone comes in W is welcome back instead of do you have a reservation?
• 12:32
  Speaker 2: How can we make this person feel empowered?
• 12:35
  Speaker 2: Welcome back, the O is like you're gonna offer them your specialty beverage or any additional service.
• 12:41
  Speaker 2: Let them know about the promos.
• 12:42
  Speaker 2: And the last W for that wow factor is have them share with them what's next?
• 12:47
  Speaker 2: Shop around, is there any additional things that I can get for you?
• 12:51
  Speaker 2: Your service provider will be right with you.
• 12:54
  Speaker 2: So think of marketing from all verticals, not just what you're doing outside, but also what you're doing inside.
• 13:01
  Speaker 1: Yeah, cause I think marketing, when you really think about all of the different areas inside of it, it is such a powerful tool and I think a lot of times, as salon owners or even the service providers in some of the salon, can really get stuck with social media, whether you feel like, well, I have an allergy to social media or you absolutely love it, which I feel like is rare it's not the only way that we market and just keep in mind like, hey, you're gonna get a lot of mall walkers there which mall walkers are great.
• 13:39
  Speaker 1: They'll occasionally do a little impulse buy, but when you can sit in front of the person who knows what they want, you're more likely to build a higher ticket.
• 13:52
  Speaker 1: They're more likely to be more satisfied.
• 13:54
  Speaker 1: There's a lot more win-win wins, and so coming up with that strategy for you and your salon and team is gonna be one of the keys to really growing it.
• 14:06
  Speaker 1: So we just talked about the P&L.
• 14:09
  Speaker 1: We get our finances under control and then we learn how to grow our business.
• 14:13
  Speaker 1: I think that's a key element to having a successful salon company is doing it in that order as well.
• 14:23
  Speaker 2: I love that one.
• 14:23
  Speaker 2: One of the last things we're going to connect about today is just, your culture is really I think that's a really important vertical is because, guess what, if you have a business, you've got to have people to help support you in that mission.
• 14:38
  Speaker 2: You go so much further when you have a team behind you.
• 14:41
  Speaker 2: Really, looking at your culture, what does it stand for?
• 14:45
  Speaker 2: Who are you?
• 14:46
  Speaker 2: What is it that you're put on this earth to create and to achieve?
• 14:50
  Speaker 2: Make sure that everybody's playing that same game with you.
• 14:55
  Speaker 2: What are your growth sessions, simon Sinek says.
• 14:58
  Speaker 2: He says culture eats strategy for breakfast, I think, is what he says.
• 15:01
  Speaker 2: I just love that because it really is true.
• 15:03
  Speaker 2: You could have all kinds of amazing systems and processes, but if your culture is negative, they're going to complain about all the systems and processes.
• 15:11
  Speaker 2: You're just going to feel like you're on that roller coaster, like Lindsay was saying earlier, or that hamster wheels like gosh.
• 15:18
  Speaker 2: I have all these amazing things, but there's still something happening, there's still a disconnect that's preventing me from getting to the next level or preventing us from getting to the next level.
• 15:27
  Speaker 1: Yeah, I know that it's happened to me before, where I've had gone to my team in the past with some amazing ideas of some ways that we can revolutionize our business and just to be met with naysayers.
• 15:43
  Speaker 1: I think change, as human beings can be.
• 15:49
  Speaker 1: You don't want to be changing things in wild chaos all the time, that's one thing.
• 15:55
  Speaker 1: But if you really do have an idea, that's going to be a win-win-win for everyone and you have naysayers on your team, that's going to keep you stuck.
• 16:02
  Speaker 1: For a while I thought, gosh, maybe it's me and not that you're perfect as salon owners.
• 16:10
  Speaker 1: I know I'm not perfect.
• 16:11
  Speaker 1: When you really have everybody's best interests at heart and you have people who are pushing back, you know that they're not the right fit for your team.
• 16:24
  Speaker 1: It can really be a beautiful another podcast about how do you release somebody when you get to that spot, because it's a gift for them too.
• 16:34
  Speaker 1: If they don't want to be there.
• 16:36
  Speaker 1: They're not on board with all of the amazing things that you have going on inside of your salon company doesn't mean that they're bad people.
• 16:42
  Speaker 1: It just means they are not the right fit for you.
• 16:45
  Speaker 1: Recognizing that can really keep your wheels turning and can keep your ship sailing in the right direction.
• 16:54
  Speaker 1: Just having that high awareness like hey, if we get too many red light people on our team, we will be stuck.
• 17:02
  Speaker 1: Understanding that and understanding when it's time to release someone to find their next opportunity could be one of the key parts to having a successful culture.
• 17:16
  Speaker 2: I love that.
• 17:16
  Speaker 2: Lindsay, you know we talk about realities, as we all have different realities as human beings.
• 17:22
  Speaker 2: We all grew up in different households.
• 17:24
  Speaker 2: The way it occurs for Lindsay one way may occur for me differently.
• 17:28
  Speaker 2: When you're working with a team, it's really a superpower to understand everyone's reality and how sometimes their reality is keeping them stuck.
• 17:40
  Speaker 2: As a coach or an amazing salon owner, I think that can be a superpower of yours.
• 17:45
  Speaker 2: If someone's always saying I think so and so gets to do more than I do, for example, somebody might would probably say that or maybe you've heard that before and like to understand okay, what's the reality right now?
• 18:00
  Speaker 2: Because that's just an opinion, but let's create some facts around that.
• 18:05
  Speaker 2: Is this really happening, is this really showing up for this person?
• 18:08
  Speaker 2: And so I think that is also a really beautiful place to come from is to be able to listen to what's happening, have that servant listening ear, and that will give you a lot of superpower to know, hey, how can I coach this person, how can I get us to play the same game of reality of salon business, so that we all have that win-win situation?
• 18:31
  Speaker 1: So true, you know, and I think there is that's such an important part, definitely, of leading a great growth session as well.
• 18:41
  Speaker 1: You know, and there's some other ones too that you can look at when you're thinking about how can we, you know, create a bigger, brighter future for our service providers?
• 18:52
  Speaker 1: You know, and a few key areas I think to look at when you're thinking about that too, are how do we celebrate wins with people?
• 18:59
  Speaker 1: You know, a lot of people have some great things that they're achieving.
• 19:02
  Speaker 1: How do we recognize them, you know, and how do we then enter and create more of that?
• 19:09
  Speaker 1: And then, how do we understand how to look at their numbers and how to coach to what's happening?
• 19:15
  Speaker 1: Because, you know, we just believe that numbers are telling a story about what's happening for a service provider, and so if their, you know, retail is really low, then, you know, let's take a look at what our conversations are like.
• 19:28
  Speaker 1: What problems are they uncovering that the guests have with their hair?
• 19:32
  Speaker 1: What desires what?
• 19:34
  Speaker 1: You know, what would they love to have different about their hair?
• 19:37
  Speaker 1: You know, there's some missing components when that number is low.
• 19:41
  Speaker 1: There's several different areas, you know, inside of their numbers that are telling different stories.
• 19:46
  Speaker 1: But then how do we create a plan?
• 19:48
  Speaker 1: You know, and I think when each person on our team has a plan, then that's when we're able to create a bigger, brighter future.
• 19:57
  Speaker 2: Mm-hmm, I love that.
• 19:58
  Speaker 2: So those are just three of the amazing verticals that we talk about in salon business school.
• 20:04
  Speaker 2: You can always reach us at the hello at the PhD program if you want to learn about the nine other verticals that we really dive into to really create that foundation, you know, to really get your root system strong so that you can really thrive and survive and create the son of your dreams that you've always thought possible.
• 20:24
  Speaker 1: Yeah, so if you want to learn more, like Jen said, head us up.
• 20:27
  Speaker 1: We would love to hear from you.
• 20:28
  Speaker 1: Or if you have any ideas for a future podcast or something that you would like help as a salon owner, we would love to support you along your journey.
• 20:38
  Speaker 1: Thanks so much for tuning in.
• 20:40
  Speaker 1: Be sure to let your friends inside of the business know.
• 20:43
  Speaker 1: If you got some amazing value out of today, I'm sure they could as well.
• 20:47
  Speaker 1: Awesome, all right.
• 20:50
  Speaker 2: I'll see you soon.