How To Run Your Own Beauty Salon: Cash Flow is King

How To Run Your Own Beauty Salon: Cash Flow is King

 

how to run a your own beauty salonRunning Your Own Beauty Salon…

Whether you’re just getting started running your own beauty salon or you have been running your own beauty salon for a while now, you must know your business basics. Salon Plaza is answering the most important questions about how to run a salon successfully to make it easier for you have what you want most in business and in life.

“Where are you right now in your career?”

To know what you want your future to be, how to get there, and especially when you’ve arrived, you must know your starting point.

There’s really no getting around it; running a business involves some simple math. Without knowing your numbers it’s easy to make poor decisions and eventually go belly up.

And nobody wants that.

In a hair salon, nail spa or beauty salon, cash flow is king. Three things that drive your cash flow are new clients coming in, repeat visits, and retail sales per client.

The single most time consuming and potentially expensive thing you can do to build your business is to get new clients. That’s why keeping your clients coming back is the secret to doing better than just getting by.

Repeat customers give you a higher return on what you spend to get them to come in for a first visit. Repeat customers tend to buy more services and products. Plus, they are more likely to recommend you to their friends and family.

hair salon district heights weaves braids loc natural hair care 5 - own beauty salon

To keep your clients coming back, give them great service.

Lisa Pettway, owner of Follicles Hair Studio in District Heights, MD, says 90% of her clients are returning customers. Because walk-ins look for a one-time service, the best new clients are referrals. They tend to stay.

To get more referrals, think of your clients as a canvas – when they leave, their hair is your best form of advertising. Stay on top of the latest trends and be ready to give your clients what they want.

What’s most popular today? Natural hair care, braids, weaves, and locs…

including cornrows and two strand twist pin-ups.

Customers generally bond with their stylist rather than with the salon itself. If you have employees or rent booths to other stylists, you may lose a block of clients when they leave. When stylists move on, their customers tend to leave with them. Employee turnover rates are about 40% a year, even higher for booth renters. That means, more than a third of your staff – and their clients! – are likely leave each year.

Are you overlooking the most important measure of the health of your salon?

Your revenue comes from two sources: services and product sales. A good rule of thumb is to earn about 80% of your revenue from services and 20% from product sales. If you’re busy but struggling, focus more on selling product. Not only will it increase your income, you’re clients will look better in between visits and will be more likely to recommend you.

Know your numbers – Your own beauty salon business metrics 

In a typical week, how many clients do you see? How many can you count on regularly to come in?

What are your weekly revenues from services? What are your revenues from product sales? If you can separate income from product sales and income from services, you will get a better look at what is driving your revenues.

For many salon owners and booth renters, these are not easy questions to answer. Fortunately, salon management software can help you keep track of revenues, costs, inventory, appointments, and much more. They help you build your client list and track their spending patterns. An article about the salon management software program that Salon Plaza recommends is coming soon.

Beauty professionals who “know their numbers” have a big advantage over those who don’t. Why? Because that way you can set goals and see what actions improve your income. You’ll have a better sense of how much to spend on marketing to get a new customer.

And you’ll have fewer surprises!

Take Our Salon Owner Success Quiz

If you had the keys in hand to your own salon, how successful would you be?

That’s the number one question many talented beauty industry professionals are asking themselves.

To find out, take our Salon Owner Success Quiz. Do you have what it takes to make it? The skills, clientele and desire to create the life you dreamed of when you became a beauty professional?

Ater you take our short quiz, we’ll send you a customized report about your strengths, challenges and how READY you are right now to succeed as a salon owner – based on the experiences of thousands of beauty salon professions like you.

Find out if you have the skills of America’s top beauty salon owners. Take the quiz!

Beauty Salon Owner Success Quiz