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    14 Replies Latest reply on Oct 25, 2012 6:10 PM by sschef111

    What are you paying your hair stylists?

    mr_erp Wayfarer
      Hi - I own a 10 station salon in the Detroit area (Oakland county), and was wondering what other salon owners are paying their stylists in this area. All of my stylists are 1099 and I pay them 55 - 65 percent commission. Those at the the high end of the scale pay for all supplies, while those at the low end of the scale have supplies provided. I also provide back bar. I am profitable but revenues have dropped off significantly in the last couple of years and I am considering an across the board cut in commissions of between 2 - 5 percent. I have been told by some of the stylists that other salons are paying 70 - 80 percent commission in some cases. Not sure how they stay in business considering my costs are in the range of 35 percent and climbing. Any insight on what others are paying would be appreciated.
        • Re: What are you paying your hair stylists?
          LUCKIEST Guide
          What are you paying your hair stylists, Welcome

          Good question. I am in New York, You are in Detroit

          Do you have an Accountant?? Good place to start. Are you a Member of (or part of) of the local hair salon owners?? Have you tried reaching out to SCORE online and talking to a local salon owner who is also a
          SCORE Counselor??

          Good luck, LUCKIEST
            • Re: What are you paying your hair stylists?
              mr_erp Wayfarer
              Thank you for the reply. I do have an accountant but comp plans are all over the place in my area so I'm looking for some comparisons specific to 1099 commission schedules only. I have done some research but to be honest, the range is anywhere from 35 - 75 percent nationally depending on the MSA. I was hoping there were some other owners in my area who could give me some input. I will check out SCORE to see if they have anything that would be helpful. Thanks again.
            • Re: What are you paying your hair stylists?
              jenn123456 Newbie
              hi i am a stylist in ct and i am paid 55% commision or $15 an hour of a garantee what ever one comes out to be more just incase of those slow weeks. hope that helps:)
              1 of 1 people found this helpful
              • Re: What are you paying your hair stylists?
                DomainDiva Ranger
                I know that my stylist gets 55% plus her tips. I can understand managing costs. My stylist tells me that the frequency of appointments has dropped off as have tips. I have even scheduled differently since January due to special events, hopefully I will be back on 4 weeks after Aprils' appointment and event.

                Now, cutting commissions across the board? Are you going to just cut? or...have a meeting with the staff? After all losing a stylist means losing customers. (Trust me on this I have followed my gal as this is her third salon since I found her...). Her third salon you ask....... yes since a lot of owners do crazy things to the stylists. Any salon tha'ts paying 70-80 percent is probably just charging booth rent as a percentage of stylist income.

                Instead of looking for ways to cut costs....get your stylists together and come up with some creative ways to bring in more business. Have a hair fair with 10 percent off. Happy people return again and again. It's about staying in business and creating new opportunities...you should have addressed the drop in revenue the first month you noticed it....not a couple of years later.

                For the record...I consider my stylists' obscene tip a part of my monthly expenses and do without accordingly to make sure she gets it.I am SO dedicated.
                  • Re: What are you paying your hair stylists?
                    mr_erp Wayfarer
                    Your points are interesting - utopian, but interesting. Most customers naturally see the business through the eyes of the stylist and don't really understand the business at all from an owners perspective. After all, the average customer sits in the chair for 1 - 2 hours hearing about the world according to their stylist, unaware that the seat they are sitting in, the lights above them, the heat, the airconditioning, the coffee, the beautiful decor, the receptionist, everything around them, is provided at the owners expense.

                    The fact is that revenues continue to drop due to the economy - ESPECIALLY in the Detroit market. I track my numbers daily, sometimes even hourly so yes, I have been addressing the decline in revenues. Unfortunately, my cost continue to rise including utilities, rent, supplies, products, insurance, wages, advertising, etc. The cost of doing business continues to rise regardless of revenues. Perhaps one option would be to raise prices to increase revenues but alas, price elasticity of demand is extremely inelastic and a large number of customers WILL go elsewhere to save a buck - despite their loyalty to the stylist. In addition, our stylists refuse to charge the higher prices fearing they will lose clientele. Another option might be to hold a promotional event similar to your suggested "hair fair" that would benefit a local charity or include special discounts or both. Again, the stylist will gladly do this IF it does not come out of their pocket AND it is done during their normal work schedule, i.e., Sunday is completely out of the question for 95 percent of our people.

                    In general, stylists are very independent minded people who for the most part look out for themselves above all else. Their number one goal in life is to maximize their profits. And as you so succinctly pointed out, they know that they can go down the street to another salon any time they please if the owner does not continually placate or treat them in a manor that is befitting them. It is extremely rare to find a stylist who understands the business and/or cares enough about the shop they work in, and is willing to make the kind of sacrifices that may result in a short term loss for a long term gain. I know this because I've got a couple of these exceptional people working for me and they continually go out of their way to do what's best for both them AND for the salon. In most cases, these are the folks that will become owners themselves one day. They just get it. So hopefully the next time little Suzzie tells you how terrible the place is and/or how horrible the owner is, just before she packs up her scissors and moves again, you might remember that there's her world and then there's the business world.
                      • Re: What are you paying your hair stylists?
                        DomainDiva Ranger
                        Little Susie did not have to tell me about the crazy owners...I got to see it for myself....first hand. I watched as one owner paid 11.00 an hour while I was paying 125.00 for a cut & root touch up, and watched as another owner would come into the salon screaming about HOW BAD the world was and OMG she just did not know if she could make the salon work.... stylists were quitting left and right. I found my current gal as she was the third one that salon had put me with, when she quit, I walked as well.

                        My Mom styled hair and had her own shop, I have seen it from both sides. Keep the stylists happy, the customers will come and the bills will get paid. If your stylists are so independent, then you as an owner have to get them into a team. My stylist and I both like the salon where she is now. When we decided to change my color another stylist in the shop gave her his recipie for this wonderful grey/blonde. Teamwork. That's what makes money.

                        As a small business technology start up I know full well the costs of doing business, it's not cheap and it hurts, but a dedicated TEAM will pull you through. However utopian that sounds.
                        • Re: What are you paying your hair stylists?
                          laurabell Newbie

                          Sounds like were managing the same kind of employees. I cannot make any changes with out them threatening a walk out. Even in this economy they would leave for some small thing i needed to change. Are you a stylist behind the chair also or business owner only? I am behind the chair also but would love to just focus on the branding and marketing of the store. They have no idea what kind of paperwork just paying the bills are. We are still reasonably busy, All do to the fact I spent about 3000 on marketing to the higher end areas that border our town. We are moderately priced but our stylist are all really good so I started competing for the day spa clients that would not quiet lower themselves to a chain store like super cuts or great clips, but would settle for us right now. But do my Employees even notice or care I just spent 3000 to keep them in business. No way. And I do say them in business not me because they all get paychecks at the end of the week. I keep telling them if they want to keep these clients the gotta class it up alittle. You know, can you not put hair color on your own head and then proceed to cut one of your own clients. I'm not joking they do this all the time. They say oh my clients don't mind, I've been doing them for years. So here I spend the money on a new client that is sitting there watching the other employees working with foils or color on their head. So he is old school and doesnt want any one to walk out before i get him paid off. So im stuck in the middle. I know the technology and marketing capabilities of a computer system could be invaluable. To be able to give clients incentives to come back sooner, market to ones that have been missing and so much more. One of my stylist actually said why do you want to market to the clients we already have? I didn't even now what to say to that kind of thinking. This store has so much potential if it was run efficiently, but I just don't know if i have the guts to make the changes it needs and see were the chips fall.........
                            • Re: What are you paying your hair stylists?
                              laurabell Newbie
                              So that was funny, they cut off a whole paragragh about the computer system i bought, guess because i named the system. But the point was the stylist called my partner and demanded that they not have to use the system. And my reference to my partner being old school was about not wanting to bring new technology into the store if it ment he might lose some of the stylist before the buyout is complete.
                              • Re: What are you paying your hair stylists?
                                DomainDiva Ranger
                                Laurabell....honey you have some serious employee problems. I hope you get them resolved. As the owner you are going to have to have the guts to make the changes. Its going to hurt SO BAD. However long term your business will survive. Good luck. DD
                                • Re: What are you paying your hair stylists?
                                  sschef111 Newbie

                                  Laurabell -

                                  I agree with DomainDiva, there are serious employment issues in your salon.  I was in the salon industry for 17 years, six years of which were spent working for Redken in two different positions.  One of those positions was as a Regional Sales Educator.  While I was in that position, we used to do trainings to help salon owners figure out where their money went every month, how to increase profitability, etc., as well as educating their stylists on what it took for the owner to pay the bills, and how the stylists could take more 'ownership' of helping with the bottom line... this also helps stylists realize that the owner(s) aren't just 'taking' their money.  I'm not sure they still do that program, but it was, for most, life changing.  Some owners didn't even know what a P&L statement was, much less how much (or little, in many cases) their profits were at the end of each month... so if the owner didn't know their financial situation, it was impossible for the stylists to have any clue.  You should check with your distributors for such a program.  Jenn123456, you could also benefit from such a program!

                                   

                                  That being said, stylists should NEVER be getting their own hair done during salon hours, ESPECIALLY while they are working on a client... that is the ultimate in unprofessional behavior.  If you don't have a salon POS system, get one NOW...  It will help you tremendously!  Or maybe you could contact Tabatha Coffey, she'll set your crew straight!  And unless you're a retail store that just happens to have stylists, instead of the reverse, it's called a salon... not a store. 

                                • Re: What are you paying your hair stylists?
                                  hair chateau Wayfarer

                                  my thoughts exactly no one understands the business point of view only the selfish pt of view. its sad they think owners are "taking" there money when really they arent

                              • Re: What are you paying your hair stylists?
                                DebbyBlitzLoc Adventurer
                                I live in the metro Detroit area and know plenty of people that have stopped going to stylists simply due to financial concerns. Even those who were hard core and never missed an appointment! They say the economy is turning around, but in Metro Detroit that has not yet been the case!

                                Debby
                                • Re: What are you paying your hair stylists?
                                  hair chateau Wayfarer

                                  if your paying that high of commissions are you deducting service fees?