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Advice on employees who made unauthorized purchases for salon

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SirenSpas

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I own a nail salon with two employees. Recently, both of them went shopping for more nail salon supplies as we needed hand lotion and nail files and they wanted to visit a new bulk store right by their house. I told them to keep their receipts so that I could reimburse them. The problem is that they went absolutely wild and bought $300 worth of stuff. Quite frankly, it's a combination of stuff that won't bring increased profit to the store and overbuying needed items. Like floating soap in the shape of rose petals, Gucci logo nail stickers, fancier tools for themselves, and 400 pedicure bath bombs (which is the amount we would use over to years). The things we did need, like the lotion, they bought without price shopping when they could have gotten it cheaper at our normal supplier.

On one hand, I simply don't have the money to pay them back. Finances have been beyond tight since the pandemic and I'm pulling from my savings to keep the lights on. I also don't feel like paying for fancy soap that I didn't even ask for when it won't bring increased profits.

On the other hand, my business would be nothing without them. Both of them have been hired for less than two months and they have brought in more customers than my last three employees combined. Good nail techs are very hard to find in this city and I hesitate to offend them and risk them looking for work elsewhere when they would be so hard to replace.

So ultimately, this leads to several questions that I would like to hear from experienced business owners.

1)Should I reimburse them in full?

2) Should I only reimburse for the needed things that they bought vast amounts of without price shopping? How do I decide what's needed versus what is not needed. Some of the purchases are a grey area, such as nail gems. Which, they weren't needed, but if we do sell them, they'll be worth the purchase.

3) If I don't reimburse them, what's the gentlest phrasing I can use to explain that I didn't approve of this and they'll have to pay for their mistakes themselves?
 

Haircutz

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If I don't reimburse them, what's the gentlest phrasing I can use to explain that I didn't approve of this and they'll have to pay for their mistakes themselves?
Firstly, it sounds like a serious error of judgement on your behalf and you need to acknowledge to them that you made a mistake too.

As the salon owner, you need to be keeping on top of re-stocking supplies or put one person in charge of the task but with proper training of how to carry out those duties within a strict budget.

If you didn’t give them a maximum budget and list of items to purchase, then you also need to accept responsibility for resolving this issue.

When you talk about ‘gentlest phrasing’ are you sending them mixed messages about your roles in this business? You are the boss and they’re your employees and you need to always act with this in mind.

Explain to them both that you have a budget for supplies that doesn’t stretch to buying all these unnecessary extras and work out what you won’t use and tell them very firmly, to either return those items or keep them but you will only be re-imbursing them for what you will be using.

Unless they’re teenagers, they must have had some concept of what they were doing?
 

HMC

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I would open the conversation and be honest.
I agree that is was an error on your part not to specify a budget or a list, and you expected the total to be under $ amount. Ask them what THEY think you should do? (Not that you would do what they say, but to see their point of view and to see that they understand why this is an issue). Would they like to keep some of the things as personal purchases, or would they prefer to have them returned (if possible). At this stage I can afford X Y Z. I love that you are interested and excited etc etc. the extra items purchased can be something we work on over time? Then create a new plan going forward (budget or shopping list confirmed by you first - anything over that is personal purchase etc.).
Hope that helps with your solution.
 

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