Advice on possible venture please.

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stoney

Well-Known Member
Joined
May 13, 2004
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Location
Montrose, Scotland
Have the opportunity to go into a well established salon in my home town. I know the owner personally and have been a friend of her family for over 15 years. They are about to open another premises in town, not beauty, more alternate therapy and don't want to sell the existing business, but can't sublet it so has asked if i would like to go in to do nails along with a beautician. Terms :

10 per day each if takings under £40 each
£40 + takings, 25% comission
no comission on retail

they pay rent and rates. Beautician and i split electricity, phone and credit card machine costs and comissions. We both buy own stock.

BUT has, for the past 6 years, been giving 10% discount to loyalty card holders, all 832 of them! and gives 20% to family and Tesco staff. And therefore would like us to continue in similar fashion.

Tried my hardest to do calculations and cant see how this can be viable for us with such regular, huge discounts.

HELP!
 
wow, generous person! (sorry if spelt wrong)


wish i had money to throw away like that!
 
stoney said:
Have the opportunity to go into a well established salon in my home town. I know the owner personally and have been a friend of her family for over 15 years. They are about to open another premises in town, not beauty, more alternate therapy and don't want to sell the existing business, but can't sublet it so has asked if i would like to go in to do nails along with a beautician. Terms :

10 per day each if takings under £40 each
£40 + takings, 25% comission
no comission on retail

they pay rent and rates. Beautician and i split electricity, phone and credit card machine costs and comissions. We both buy own stock.

BUT has, for the past 6 years, been giving 10% discount to loyalty card holders, all 832 of them! and gives 20% to family and Tesco staff. And therefore would like us to continue in similar fashion.

Tried my hardest to do calculations and cant see how this can be viable for us with such regular, huge discounts.

HELP!

I don't like the terms. The customers loyalty is to the owners NOT you. Why should you give a loyalty bonus to people who are not loyal yet to you?
If you have to continue to do this, you will have to raise your prices to accommodate it. As for family and Tesco shoppers ... It is HIS family not yours. Give them the 20% off if he likes, but he has to pay you back for it. He may not be so generous to his family when he has to pay for them in cold hard cash. Tesco shoppers? ...NO deal.

25% commission is not too bad but you should get commission on retail especially if you are buying the product ... they should get no commission on the retail business YOU do. What a stupid idea! Why would you have any incentive to sell anything if you get nothing for it at all. :rolleyes: They get 100% commission on the stock YOU buy for retail? rediculous.

I need to know more. Will you 2 be the only ones in the shop or are there other operators in there??
 
sorry didint explain very well did I!

We are the only two in the shop at the moment. I have my nail station and the beautician has her beauty room. There are two other rooms upstairs, one is which the owner is planning to let to a hairdresser.

She is proposing : £10 per day, if takings under £40.
If over £40, we pay 25% comission.
but if we make no money, we still pay £10 for every day we are in.

We buy our own stock, which is fair enough, and any retail we buy and then sell we get 100%.

We then have to split: electricity, landline phone rental charges (incoming calls only, we use our mobiles), and the credit card machine rental and comission charges.

nearly every customer that has gone through the door of the salon has been given a 10% loyalty card, and the owner previously did a deal with tescos, that their staff would receive 20% discount.

Even putting my charges up to £40+ per set, if i have to take off material costs etc, 20% discount, 25% comission etc. Woun't really be left with much eh?
 
Sorry I just would not consider those terms.

Why should you give your services to people who were loyal to someone else? Becuase that is what you would be doing with the staff from Tesco and the other clients.

My feelings are that you would not be left with alot. As you have said take the 20% discount, 25% comm, product costs and then all of the bills........I feel you would be working for love not money!!!! Sorry just MHO.
 
how much would it cost for you to rent out your own shop with the beautician, you two don't have to be business partners, but just like flat mates!
 
you need to find out thr cost of renting your own place vs the deal you have now
according to my calculation 40.00-20%=32.00-25%=24.00 per customer [without knowing the flow of business] one person a day=24.00 x 6days=144.00 x 4weeks=576.00 - electricy, phone and credit card rental avg 100.00=476.00 a month
I don't know your product cost per person that needs to be minius out of 476.00 This is base on one person per day with NO over counter product sale.
So find out the cost of renting on your own.
Hope I Helped

-----------------
TRINI
 

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