Advice please for salon owner

[autumnx]

Hi there. This is my first post so bare with me. I'm not a beautician or hairdresser but I own a salon. I did have a business partner who was a beautician but since it opened I brought her out as we couldn't work together and she couldn't afford to buy me out.

Salons been going just over a year and were quite busy I think. We do everything from sunbeds to nails and hair. My staff hated my business partner and are all glad I took over the entire business. However tbh even though I've learnt a lot in a year it's kind of scary.

Everyone works on self employed basis and pays either rent or commission. What they pay covers a full time receptionist, printed flyers and flyering boy handing them out daily, price lists and all advertising, all bills, kitchen, parking etc etc. I feel like all my staff take home money and since salon opened I not seen a penny back. Which is fine as long as I'm going in the right direction.

Basically I'm wondering about the prices they pay, I pay my receptionist and flyering boy wages and the flyers and price lists themselves costs hundreds, with rates and rent were talking several thousands a month.

Do my rates to my staff seem fare or shall I put them up?

2x Hairdressers 60/40 (I get 40%) I buy colour and they buy off me (I make £1 per tube)

1x Nail girl pays £100 a week works five days on table in window uses her own products

1x waxing lady rents room pays £60 a week but only works weekend and uses her own products. her stuff takes over the entire room so I can't rent out other days. She 1st told me she'll become full time but since has told me she can't.

Also what's the deal on holidays, I want to say full time staff allowed 2 weeks off without paying rent and part time 7 days without paying rent, anymore and they pay. I've worked out since when they all started they had double the above time off In only 8/9 months and don't pay me for even a day off. If it looks quiet on the diary they suddenly say oh I'm not in tomorrow and boo it out and take it off the rent. To me this isn't fair.

Sorry it's long post thanks in advance.

 

[Saira23]

I can't really offer opinion on the hairdressing rates, Etc. But I'm sure somebody will be along soon to help you
Only thing I thought I'd query is the waxing woman, why does she pay £60 a week and the nails £100 per week? If this is just because the waxing lady can only do weekends then I'd perhaps consider getting someone new in who will be working more and increase the rent.
Well done though on going it alone. It's not easy but sounds like you've got it all under control

 

[RED STAR]

Hi there,
I'm not sure about the rates you are charging, as it would depend on the going rate in your area, and the quality and location of your salon.
I think with hairdressers it is usual for a 50/50 split, or 60/40 to the salon owner if all stock etc. is included.
I cannot see how your present system is going to work! How can you balance your books when you've no idea what will be coming in from your rent!
If your 'renters' decide to take a day off, they still have to pay for that day, it works just as if you are renting a house or flat......you still pay the landlord when you go on holiday.
Regarding your waxer, if she is only paying for the weekend, then rent the room to another therapist for the day's she isn't paying for.

 

[squidgernetball]

Totally agree with all that has been said.

Your details don't give your location so it's hard to know what's reasonable.

As far as a hairdresser split goes, what you have set up seems to me to be hard to follow. As has been said, it's usually split with products included. If you take a percentage of their earnings and they don't earn you get no money which is why I don't like a percentage split. I would rather a weekly rent and then I know what I have coming in and if they're off for 2 weeks it's irrelevant as the rent is still payable.

As far as the beauty room goes I would tell her that she either pays for a week or shares her room. If she is paying £60 for 2 days, that room could be generating another 150 at £30 per day, or you could do a reduction for the whole week such as £150 pw. As I say, it's hard without knowing where you are. I charge £25 per day for a small room and that includes heating, towels, tea, coffee etc. They literally turn up and work. They all use their own products.

If you were to start over, would you change anything. I would start with the easiest which I think is the beauty room. She has moved the goal posts and you need to move them back.

Good luck

Vic x

Sent from my GT-I9505 using SalonGeek mobile app

 

[AcidPerm]

You seem to be in a muddle with all the different bizarre arrangements. May I suggest you might benefit from speaking to a small business adviser and then get some professional help with drafting legally binding contracts. Don't attempt to do it yourself.

It's not very common to allow self employed staff rent free periods for holidays/sickness but you can choose to do this.

Why are you advertising 'their' businesses? Do you charge them separately for this service?

Do you know if your stylists are any good? What percentage of hairdressing clients return? If a client returns to complain, how do you manage the situation? Who refunds the clients? Do you make any money on retail products?

If you are serious about this venture making money for you, you need to approach this in a more business-like manner.

 

[ColourGirly]

To be blunt-

You also sound WAY too nice.

Your staff decide not to pay you on their day off?

Why do you make £1 a tube? Why don't they buy their own?

Your waxing lady has dictated the room use? Either she leaves all her stuff in their and pays storage or she takes it with her and you let someone else in there?

The hair stylists aren't covering the costs of what you are offering- if they are self employed why are you buying their colour, booking their appt, advertising their business AND they get 60% AND rent free days.

Sort it out now!

 

[autumnx]

Hello. I've not changed anything since I took over its always been this way.

The salon is in a high street location in Hertfordshire. We've always done the promotions and used to sometime charge extra £ when flyers were printed to help cover costs but the staff would moan about this so much we rarely got it and tbh what we asked for hardly helped anyway so wasn't worth the arguement. My old business partner thought she knew everything about business but really turned out she knew nothing and now I'm in charge I think things need to change.

The hairdressers split is what I am most happy about as we generally are busy they often end up giving me £200-300 a week each which is more than I think rent would be. We didn't used to do the colour thing but it ment they had to go to a shop and buy a tube every time a client came in and was unprofessional so we brought colour and sell it to them when they need it. As I'm not a stylist I thought in terms of stock check it's easier me knowing how many tubes I've sold than a split where they could be lying about how much they use and stealing it.

 

[autumnx]

Sorry didn't mean to press send.

As of jan 1st I want to make sure it's going to be better than my old partner had it. I'm going to tell my waxing lady she either has it full time or takes her stuff and I rent out the other days.

Re holidays am I still being nice allowing 14 free days holiday a year if full time and 7 if part time ? What's the norm.

Thanks x

 

[ColourGirly]

You've changed everything to benefit them not the business!

They are self employed they should have a stock of colours not popping out to buy a tube! They buy what they need and use it! Colour goes far when you have little of it!

Because the staff moaned about paying for the advertising you let them not pay??

 

[autumnx]

Yh, The old business partner let them not pay a few times If it had been quiet for them such as at the very beginning when we opened . We have sunbeds And a few other things that we flyer for and so we added all services to this flyer but trying to get staff to pay towards them was a misson and my business partner would literally argue with staff over it. I don't want to have that issue so I'll rather include it in their rent as one fixed price instead of "oh it's been a quiet week can I pay next week" and same excuse the next week again.

 

[autumnx]

Oh and re the colour. None of my hairdressers had their own supply so they would literally do a consultation then pop down the road to the wholesalers. My old business partner said when she used to supply products people stole them and so on so she never wanted to do it that way again but me I don't want my staff popping to shop to buy colour so i brought it in bulk cheaper and sell it at same price they buy it from the shop so this way I can stick check well and make money on selling it

 

[AcidPerm]

Sorry, but I think one of your biggest problems is that you keep referring to them as STAFF.

They aren't your staff.

They are individual business entities. They have total responsibility for the success/failure of their own businesses.

You are simply their landlord.

Please read the following link containing HMRC own guidelines. This might help you to understand the differences between employed and self-employed hairdressers.

VTAXPER69100 - Particular trades: Hairdressing: Guidelines agreed with the National Federation of Hairdressers

I realise you might think I am being annoyingly pedantic but if HMRC think you are treating them as if they are your staff, they can prosecute you and fine you for non payment of their Tax and NI, even if they have been paying their own contributions.

HMRC are stepping up their investigations of salon owners blurring the lines between employed/self-emloyed (I have a friend who works for HMRC in the UK).

Obviously, I appreciate that you are not trying to defraud anybody but I seriously think it's in your best interests to obtain professional advice and review your arrangements as a priority!

 

[sdsurge]

Hi
I agree with mostly everything that has been said (apart from the big HMRC scare that prevails on salogeek). However, taking in everything that you've said, I think your main issue is cost and expenses. Lets imagine on an average week you get £760 from the four. Going with the lower rate of £560 per week or £2466 per month.
Most places that do rental don't charge anywhere near £200-300 per week, so you're right with the commission.

1) You need to analyse your cost and expenses.
2) Analyse your stock buying, do you buy too much, is your mark-up too low
3) Do you ABSOLUTELY need a flyerboy
4) Do you use the most price competitive printers
5) Less printing, more tweeting, Facebooking, emailing
6) Charge for ancillary services such as advertising/credit card charge etc
7) Either rent is daily or weekly, can't be changeable.
8) Utility bills, are you locked in? can you switch, can you pay monthly?
9) Adopt and get them to agree certain terms and conditions of your shop (like holiday notification)
10) Do you need a receptionist? Could you not pay yourself that, rather than nothing?

 

[Beau-ty]

Rent is usually paid whether they are there or not, I rent a room and pay every week whether im there or not, if I have a 2 week holiday which is very rare I still pay rent, annoys me but I know its the norm and figure if i had leased my own shop I couldnt say to a landlord I'm going away so I wont pay then. Your rentees are very lucky !

 

[autumnx]

Thanks again for the further replys.

I think after this box of flyers go we will stop doing it. We are pretty much well known now. I will give everyone the choice we stop or we all pay towards it equaly.

As for products we don't sell any to clients (again my ex bus partner had a problem in their previous business with theft so said she didn't want any in here).

Re printing costs yep we do get a good price as its family friend discount.

Working everything out what comes in and what goes out we are in the plus and have been for some time so if I cut major costs such as flyer boy we should see some profit. All profit so far has gone back into salon decor and making it nicer so that's why I'm not concerned to have no earnings as yet.

I'm going to put up the rent as of jan to waxing lady and nails and will think about weather to give free holiday or not. Neither of them have had a rise since they started with me and most days they are fully booked or at least busy.

I'm used to running companies where people get a wage and do as you say. This industry is slightly different, but I think I'm getting there.

Re the person who said about hmrc as I use the word staff. I say that because it's easy to explain who I'm talking about.

 

[beccascottx]

Hi!
I rent out hairdressing chairs also! You are doing it way too cheap! My girls have the option of 60/40% (I keep the 60 and buy the colours) Or £100 per chair per week! Also the idea of £60 a week for a waxing lady to use the room only at weekends is just insane, to maximise profits you need to be renting the room out all week & for more treatments than just waxing! ✌️

 

[autumnx]

Hi!
I rent out hairdressing chairs also! You are doing it way too cheap! My girls have the option of 60/40% (I keep the 60 and buy the colours) Or £100 per chair per week! Also the idea of £60 a week for a waxing lady to use the room only at weekends is just insane, to maximise profits you need to be renting the room out all week & for more treatments than just waxing! ✌️

Hi Yh she does more than waxing but still only at weekends. I also have other people who occasionally come in (when we have bookings) who do other services but nothing full time. All our services like hair and nails took off really well but the beauty room is hard for us to book for some reason. The lady in there now uses her own clients mainly but works elsewhere in week. For some reason when I do advertise it I never get any response for it so that's why it's been kind of left. My ex bus partner wanted to knock it down and turn into more sunbed space but tbh we don't need more beds, anyway would love to rent it out in week full time but I just can't seem to fill it.

 

[beccascottx]

Hi Yh she does more than waxing but still only at weekends. I also have other people who occasionally come in (when we have bookings) who do other services but nothing full time. All our services like hair and nails took off really well but the beauty room is hard for us to book for some reason. The lady in there now uses her own clients mainly but works elsewhere in week. For some reason when I do advertise it I never get any response for it so that's why it's been kind of left. My ex bus partner wanted to knock it down and turn into more sunbed space but tbh we don't need more beds, anyway would love to rent it out in week full time but I just can't seem to fill it.

What treatments are you currently offering on the beauty side? I also find that hairdressing tends to be more constantly busy than beauty as people panic when they have roots or need a hair cut, but for some reason feel that they can go without a set of nails or a wax! It can be a very hard situation, maybe try and get your hair girls to recommend some of the beauty treatments offered in the salon, or encourage them to work together where they could do maybe, a package where they get a curly blowdry and shellac nails for £25-35! I find things like that are always popular especially around the holiday season. xo

 

[autumnx]

That's a good idea to do a package. She does waxing, eyelash tinting and gel nails (my nail girl only does acrylics). We also occasionally do teeth whitening, botox, false lashes, threading and spray tans via other people but these are not regular things and they only come in when we have bookings

 

[autumnx]

For all the above I take a % not rent