How much should I be paid per hour/commission?

[HMC]

My boss is not in the beauty industry aside from owning our studio - so I'd like to go to him with my own research/figures when I ask him to revalue my pay rate. I know he will do his own research too. I understand the answer depends on a lot of factors, but just want to get an idea.

1. What's the approx. pay difference between a junior and senior therapist, head-therapist and head-therapist/manager? (I am the head-therapist/manager)
2. Is commission generally 10-15%?

I am in Auckland, New Zealand (rural). I have 8 years of hands-on experience. I am working approx. 40-50hours per week. I manage the day-to-day running of the studio with 2 other staff (1x junior therapist, 1x 6hr/week reception helper). I do all admin, marketing, website updating and designing. I also have my own weekly schedule almost always fully booked with treatments. The only thing I don't do for the business is pay accounts and staff wages.

There is no commission structure currently. I am currently paid $24NZ/HR, no commission.

I've just been told by a mentor in the industry to be asking for $30/HR + at least 10% commission. She has sent me here to ask for more advice.
What do you get paid? What do you pay your staff? Commission? Any advice you can give I appreciate, thank you.

 

[rubywoo]

It sounds like you have outgrown the business you work for. I can't see how they can afford to pay you much more with only a junior therapist there to generate revenue. Your pay (£12.43 GBP) seems good for such a small business although I have no idea what a good hourly rate is for your country. Have you thought about working for a larger business with a larger team, that may be the way to get the salary you have the experience for. If you are doing treatments as well then that's a different matter. Commission is often generated by triggers, you bring in X amount for the business and you start with X percent, hit a second trigger you percent rises again. I'm not sure how that would work in small salons however.

Re-reading my post I don't seem to have been much help. Sorry!.

 

[TheDuchess]

Rubywoo has made some good points. In the Uk it is usual to expect a therapist to generate 3x his/her Salary in earnings and be booked 80% of your hours. This rule of thumb applies in lots of industries, not just beauty.

If both you and the junior therapist are hitting this, then any extra will be the added value that you are contributing. You can ask for a slice of this but bear in mind that the business is unlikely to be able to justify paying you more than 35% of the overall turnover. You may be better off finding another employment where you can add value to a larger team and so justify earning more.

I setup in business because I felt I could earn more than as an employee, but in fact I earned a lot less initially. The costs of a business are considerable. It sounds as though you are putting in all the hours that a business owner would - so you might consider your alternatives. There are huge risks as well as benefits to being self employed, you never keep more than 50% of your turnover when running your own business. I'd earn more working in a Spa as a Head therapist with a future as a Spa Director, but I don't think this would suit me.

You haven't mentioned the retail on your business. You should be retailing 20% of your turnover. Depending on the products that you retail, around 30% of the retail should be profit. You could ask for up to 10% commission on products which would be 1/3 of the profit and a fair split. You can also ask for an over-rider commission on the sales of your team. I'm not sure what the norm is, but as a business owner of a similar sized business, I'd certainly consider a commission of 2-5% of total sales as long as minimum %age sales targets were hit.