Easing the pain points

With salon owners now more focused on Hellen Ward analyse to grow your business this year

A regular reader recently got in touch and asked me to address quick ways to reduce costs and increase sales during this cost-of-living crisis. You’ll know that over the years I’ve covered this topic many times but it never fails to be an illuminating exercise and one that is worth carrying out. Even writing this got me revisiting a few of our regular pain points and checking in on each element with fresh eyes.

Of course, the basics remain the same: there are only two ways to increase profitability – increase sales and reduce costs. So, let’s look at the key elements of the two in turn:

Increasing sales

1. Client behaviour

We might assume we know what our best-selling service is, or worse, why clients might be leaving us, but often this is assumption not research. Customer spending habits are ever-changing. The way they shop is a work in progress.

If we want to increase sales, we have to start by asking people what they want. You don’t need fancy market research, just conduct an in-salon survey and see if you are giving people the services they are looking for.

What are they going elsewhere for that they could have done with you? Which brands or signature treatments would they pay for if you provided them? Getting direct feedback is invaluable, but be sure to listen.

2. Master the upsell

It’s pointless telling your team to get more customers when the thing that is most within their control and capability is maximising the spend of the customer they already have. Clients are very receptive to bespoke, prescribed problem-solving services tailored to them.

They are a captive audience so becoming expert at advising and consulting properly will pay dividends. They’ll know if it’s disingenuous.

Keep it real and honest, but do have the conversation. All too often, there is a perception from our teams that our customer base is well versed in our service offering. Never assume that they are!

3. Keep it local

Partnering up with small local businesses is a win for both sides. Offering a reciprocal discount for new clients can work very well as long as it suits your business, so don’t be scared to limit it to certain days and times and make it unavailable on busy days or with busier team members.

Keep it private and offer it to the staff too. We partner up with a local independent restaurant and as the team all come into the salon, they’re big fans. We’ve created package days with them too.

Controlling costs

1. Review and renegotiate

We’ve just got a £500-per-month saving from a rival EPOS provider quoting. We went back to our current provider (who we’d just renegotiated with and who’d told us we were on the lowest rates available), showed them the quote and they matched it, giving us quite a saving. Always push for more. This is the one cost we all have to bear that doesn’t impinge on the customer experience, so don’t try to make friends here; it’s purely transactional. Ditto energy and utility providers. Shopping around pays.

"It’s POINTLESS telling your team to GET MORE CUSTOMERS when the thing that is most within their control and capability is MAXIMISING THE SPEND of the customer they already have"

2. Track team performance

Coaching the team to perform well is a box that is never ticked. Failing to address poor performance isn’t fair on you or the employee, especially if they are on commission-related pay.

Make sure they know your KPIs (key performance indicators), what they mean, how they’re tracked, why you care about them and mostly what they need to do to hit them. You’ll be amazed by what a little coaching can do.

3. Reach out to your suppliers

The more you partner with a chosen manufacturer and spend with one supplier, the greater the benefit should be. Don’t be afraid to drive a hard bargain.

Suppliers can sometimes help with things that cost us but have negligible costs to them, like providing free salon sizes or at least letting you buy them at a reduced cost, as well as providing gift-with-purchase items that you can use for offers or to help sell courses.

They can also help with marketing and training so ask them for as much support as they can offer.

Keeping a business healthy is just like keeping a body fit or a car running well; it needs TLC and constant attention. Get the team involved in brainstorming some ideas on this topic too.

Profitability is complex and there are no easy solutions, but focusing on the little details will get you thinking and help to keep the coffers healthy. And we all need that!

Hellen Ward is managing director of Richard Ward Hair & Metrospa in London, vice president of The Hair & Beauty Charity and co-founder of Salon Employers Association (SEA).