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5 Biggest Mistakes Salon Owners Make

Building a successful salon business is a challenge for any stylist looking for something more out of their profession. Maximize your odds of success by understanding the biggest mistakes salon owners make and how you can avoid them.

 

1. Becoming a “Star”

As stylist, we all want to be the “Star” of our salon. We want our clients to feel privileged to personally be one of the client’s owners. This, we tend to feel, makes us command a certain respect and admiration from clients and employees alike. This makes us feel personally valuable. Unfortunately, nothing could be further from the truth.

The time when a salon becomes a truly valuable business is that point at which your salon runs flawlessly when you’re not there. This, after all, is the point at which you can go on vacation and still make money. At this point, the risk and hard work you have put in to start and develop your salon truly begins to pay off. More importantly, when it comes time to sell your business, the buyer will intuitively know that when you walk away, all of the salon’s clients aren’t going with you. The buyer will actually see something of value, truly worth paying for, in your salon. That “thing of value” will be sustainable cash flow. This will never be the case if you insist on making yourself the star. Next, we’ll tell you how to avoid this mistake.

2. Working in your business rather than on your business.

As a salon owner, whether you like it or not, you have transcended from being an artist to being an entrepreneur. This step has inevitably changed your role. Now, you must dedicate at least a great portion of your workday, to building a business. No matter how much you like your time behind the chair, it is now necessary for you to work on different problems and only reward yourself with some time with clients.

What do you work on? For starters, building a great staff. So many salon owners decide to invest in great space only to “rent booths”. In almost all cases, they are missing the big picture. In a “booth renter” salon, the salon is only as valuable as the renter’s payments and has little to no additional upside. Instead, salon owners that hire stylists, and create great training and mentoring programs, are investing in human capital that will almost always pay off. Sure, their will be the stylist who builds up a clientele on your back and then leaves to rent a booth in the salon down the street. Don’t sweat it, they won’t succeed in the long run. If you focus on building a great team that thrives in a culture where they can earn a good living, have fun at work, and enjoy a fulfilling creative outlet in an environment that they are growing in, then the great stylists will be with you for a very long time. What’s best, is so will their friends, families, neighbors, and loyal clientele they pick up along the way.

Take your time interviewing and hire slow, but be willing to fire fast. Focus as much time and energy on culture, shared vision, and teamwork as you do on your salon’s image. Not only will your employees notice, but so will your clients.

3. Not having a marketing strategy or not measuring marketing returns.

Long gone is the time when you can simply find a good “high traffic” spot, stick your sign on the door, and wait for the clients to roll in. In today’s competitive salon environment, you have to go in with a solid marketing strategy. Make sure you have a website and be sure your website is registered in Google+ Local, Yahoo Local, Yelp, and YP.com. This is essential and is the modern day phone book. Build up a referral network with “Invite a Friend Nights”, free product or services for those who make referrals, and local business employee discounts. Attend community events and talk to everyone about your salon. There is no shame in being proud of what you do and if you have a great service, people want to hear about it. Advertise in your local paper. Sponsor high school or community college plays by doing hair for the actors. Whatever you do, have a plan and get out their and do it. Never rely on people just finding you, it will rarely happen that way.

For any marketing strategy to be effective, it has to be executed. For any marketing strategy to be sustainable, it has to be measured and evaluated. Make sure you ask every client how they heard about you. Keep track and write it down. Spend more time and money on those things that bring you more clients. Calculate a cost-per-new-client (CPNC) based on how much time and money you spent in each marketing activity and how many clients you received directly from it. Do more of the activities that have a lower CPNC then others. In the long run, you’ll have a marketing machine that runs as efficiently as possible bringing you in a constant stream of new clients at the lowest cost possible.

4. Picking the wrong product lines to carry.

So many stylists get starry-eyed by all of the fashion and glamour of big-beauty brands. After all, we are in the fashion industry, aren’t we? Isn’t the greatest achievement of any stylist to be cited at a fashion show or for a cover of one of the big magazines? The answer is an unequivocal no, no, no.

Here is a little known secret that is easy for you to test. The secret is that, unless you’re using a small boutique niche brand, none of your clients know what hair color you use on their heads. Want to test it? Pick up the phone right now and dial 5 of them at random and ask them. It would be shocking if even 4 have guesses that are even close. They really care about the results. All professional hair colors are the same to them, they are really paying for the colorist’s skills.

Here is another little known secret, you lose credibility with your clients every time they see the same products you sell in your salon being sold at Target, Walmart, or CVS for half the price. Yeah, yeah, they have heard all of the stories that your Sales Rep has told you about them not being the same product and not being “guaranteed” unless they are sold from a salon. But, do you really think they believe that? Do you? Everyone in the salon industry with any knowledge of business knows that only product manufacturers, directly, can get shelf space at Target, WalMart, or any big retailer. Do you question whether your “salon exclusive” products are sold in retail stores for half of what you sell them for? Simply go to Google and search for them. If they are listed on Target, Amazon, WalMart, CVS, or Walgreens, you’re being taken as a fool and your clients, in turn, think that you’re taking them as fools, too. You’ll be shocked to find Aveda, Pureology, Wella, and Redken; as well as so many others, sold in stores everywhere.

Find a brand that is unique to your salon and is truly professional only. Do your research online before you commit. Identify a niche line that appeals to growing trends of people. We, obviously, recommend Organic Color Systems. If you do choose Organic Color Systems, test out how much we mean to your clients. Five months after converting to us, phone 5 of your clients at random and ask them what color you use on their heads. It will be shocking if at least 4 of them don’t know.

5. Not understanding the business that they are REALLY in.

It’s not styling hair, applying nails, make-up, or skin care. The business you’re really in, is making clients feel good about looking beautiful. Many clients, especially the affluent ones, can pay for plastic surgery, diets, and drugs to make themselves look young and beautiful. This, however, will make them feel cheap, “plastic”, unhealthy, and unnatural. For almost all of today’s women, beauty is not just about looking good, but it is about “feeling” good about how they look. Confidence, self-esteem, wellness, and pride make up the glow of a truly beautiful woman, and the moment you understand how to create this is the moment you have truly evolved into something greater than a beauty professional.

This starts by having great products. Very few women can feel good about looking beautiful unless they know that their well-being is in tact. Employ organic, natural, and nourishing products in your salon to instill that feeling of overall wellness and holistic beauty. Get the ammonia and formaldehyde fumes out of your environment. Don’t use products that have been tested on animals or are loaded with animal by-products. Cleanse the soul as well as the scalp. Create beauty in your clients image while nourishing their hair.

Once you master the art of creating positive emotion along with beauty, your salon will be a truly magical place cherished by your clients.

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