Are You Paying Too Much For Staff You Don't Need?

Well, we are very close to the end of 2010.  A pretty disasterous year for many with not much happiness on the horizon for 2011.  Clients are still holding on tighly to their precious money and it is becoming harder than ever for many salons to increase sales or simply keep pace with previous years' income.  So, what can you do about making things better for your business?

The fact of the matter is that if you have exhausted at all the other ways to reduce expenses and increase income, it might be time to look at your roster.    No-one likes the idea of putting off loyal team members but the reality is that you have to have enough profit after the cost of providing your treatments to pay the rest of your bills.

Simon Howden

One of the biggest expenses in any service based business is in it's wages, so this is one area that needs to be monitored very closely to ensure that your wage to turnover ratio has not gone through the roof during these difficult times.  For instance if your wages to turnover (exc GST) used to be around 35% and has now crept up to over 40%, you need to take action to get this back under control.  Reducing rostered hours may be the only way to do this if you cannot increase your income.

Now is the time to prepare for 2011 and  for whatever it may bring.  Reducing expenses is one area that simply cannot be ignored for most salons.  This is a good time to evaluate your roster to ensure you are not paying staff to simply stand around.  Tighten up your appointment taking, get rid of those expensive gaps that have crept in between each service and make your employees time more valuable to your salon.

If you need help to get your expenses or roster under control for the new year, give me a call and let me help you improve this area of your business.

Salvatore Vuono

Wishing you prosperity and success in 2011
Pam


Season's Greetings from me and my family to you and yours.