Finding the Profit Gap in Your Salon or Spa

by Pam Stellema

in Business Development, Financial Management, Salon and Spa Management

It’s challenging and exciting being a business coach. I have the opportunity to work with a wide variety of businesses and business owners, and I have never yet found any two to be remotely similar.

This is where the fun part comes in though!

Getting to find the profit gap in any business is literally like finding the gold at the end of the rainbow, and often it is much easier to find than you would expect.

Helping my clients to find the profit gap in their businesses involves utilising a series of questions aimed at pinpointing where a business could be making substantially more money but isn’t for one reason or another.

It is not unheard of for a small business to find up to $10,000 more in just one month of trading if they know where to look.

To find extra money in your salon, here are a few questions to help get you started:

  • When is the last time you price checked your competitors to make sure you haven’t been left behind in your market?
  • When is the last time you had a full price increase for the services and products your business offers?
  • Do your prices match the value you offer?
  • Is your website helping you to find new clients and get them in your door?
  • Have you joint ventured with other businesses in your trading zone to gain new clients?
  • How often are you communicating with your clients to ensure that don’t wander away?
  • Are you regularly asking your existing clients for referrals?
  • Are you rewarding your loyal clients?
  • Are you inviting every client back by offering a re-booking before they leave or a welcome pack after their first visit?
  • Are you making every effort to get lost clients back into your salon?
  • How are you measuring the productivity and return on investment of each member of your staff?
  • What incentives are you providing to your staff to ensure greater productivity is achieved?
  • How do you know which services or products in your business are your “heroes” and how are you maximising their impact on your bottom line?
  • What equipment do you currently have that is gathering dust in the corner of your salon and is totally under-utilised?
  • Is your retail sales figure no less than 30% of your overall sales?
  • How are you using your current database to market to your best customers – the ones who have already spent money in your business?
  • When is the last time you looked at the expenses in your business to see where you are paying too much for what you are getting (including staff)?

And as a final thought,[ctt tweet=”If you’re spending more time working in your business than on your business, chances are you have created a job and not a business.” coverup=”35ZyY”]

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Pam Stellema

Pam is an industry experienced coach, salon owner, speaker, author and copywriter.She works beside salon and spa owners to show them how to effectively grow their profits and remain in business for the long-term.
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