May 18, 2021

How to manage a hair salon business: Complete Guide

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Running a hair salon is a fast-paced and exciting venture. Many hair salon owners start out as stylists with a vision. They see the way the salon they work for is run and they can’t help but think of ways to improve it. Or, perhaps they have been working in a mobile capacity and decide the time has come to scale up their venture.

While it’s true that running a salon is a very creative task, it’s also a lot of hard work. There is so much admin going on behind the scenes that it might make you wonder why you ever took the plunge. As a salon owner, you will have to wear many different hats. From greeting your customers to managing bookings, ordering stock to handling insurance. It’s a varied and demanding role, but one that can be highly rewarding.

If you’re thinking about managing your own hair salon, there are a few things you should consider first. In this Salon Iris guide, we break down the key components of running a salon so you can decide if you’re up to the task.

Your business plan

Every salon manager should start with a business plan. When you create a business plan, you are making sure that you do your research and understand the market. A good business plan will look at the local competition, how much you will charge, your fixed and variable expenses, and how much you expect to be able to make. It will also include a marketing plan to show how you will let people know about your business. Marketing is essential for growth.

You can find business plan templates online. Don’t rush this stage, as you will find your business plan helpful to return to time and time again. When you aren’t sure if your business growth is on track, your business plan will help to remind you where you came from and where you hope to go.

Funding and finances

If you are taking over an existing salon business, you will need to find the funds to purchase the business. If you’re starting from scratch, you’ll need the funds for premises, equipment and marketing.

Many lenders will want to see a business plan before they even think about handing over any money. But you’ll already have one ready to go before applying! This is one way that a business plan can make it easier to get ahead. Some lenders will ask you to fill out pages and pages of information, but this can often be avoided if you already have a business plan and cash flow forecast.

You should also look for low-interest startup loans and grants for small businesses to help get you started. You never know what free funding you might be eligible for.

Local regulations and insurance

It’s essential to understand the local regulations and what is required by law to be able to operate your salon. For example, if you plan to carry out laser treatments you will have to register with the Care Quality Commission in England, Healthcare Inspectorate Wales or Care Inspectorate in Scotland. If you decide to expand your treatments, make sure you check with the local council to find out if you need a license to operate.

Insurance is another key part of running a business. From public liability insurance to employer’s liability insurance, you should make sure you are clued up on the types of insurance you need to protect your business. As a general rule, skimping on insurance is not a very good idea. 

Purchase the protection you need, or you could regret this in the future. It’s true that you might end up paying for insurance you never have to claim on, but this is a good thing in the grand scheme of things. If you never have to claim on your business contents insurance, you can count yourself lucky.

Staff and HR

The key to running a successful salon is cultivating a talented and hard-working team. Motivating your team to be the best that they can be doesn’t happen by accident. It all starts with hiring the right people, and then you need to give them the tools they need to do their best work.

Customers might visit you for the first time because you are conveniently located or they recognize the name. But they will keep coming back because of your staff. If they get a stylist they believe does a great job with their hair, they’ll be more inclined to rebook. Stylists that are always booked up and drive repeat bookings and referrals should be recognised and rewarded, otherwise, they might start looking elsewhere.

Hiring and managing a team will be one of the biggest challenges you face as a salon owner. You will have to manage the need to be an effective team motivator with the administrative demands of running a salon. If you aren’t sure if you have the right skills to motivate your team, consider undergoing management training to help brush up on these key skills.

Hiring staff

If you are taking over an existing salon, you might have a team already in place. But if you’re starting from scratch, you will need to hire your own staff. Take your time to get this right, as choosing the right blend of natural talent and potential will help to shape the future of your business.

If you are taking over an existing team, you should spend some time getting to know each person on the team so you can offer personalised support. Observe how they work together and look for potential signs of friction. Going through a change of management can be a difficult time for workers, so always be available to discuss any concerns they might have.

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Training staff

Your staff should always be learning new skills, otherwise, they could become set in their ways and stagnant. The hair industry is fast-paced and there are always new trends to be aware of. Make sure you create staff training schedules and invest in their development. A lot of salon owners fear that they will invest in their workers only to see them leave for new opportunities. But this is far better than not investing in your workers and having them stick around forever.

When you create a training schedule, you give your team something to work towards and let them know that their development means something to you. Workers will often look for new opportunities if they feel that their job isn’t going anywhere, or that there is a ceiling to their success. Calm these fears by showing that you are ready to invest in their education.

New talent

Hiring new talent should be an ongoing process so that when the time comes to fill an opening in your salon, you already have a stack of candidates to consider. Internships and work experience placements can help you identify the most talented young workers. You can also accept prospective CVs, even when you aren’t hiring.

Scheduling

Creating staff timetables can be a headache if you try to do this manually. Save yourself the headache and use your salon management software to handle this in a smart and efficient way. You can factor in things like annual leave or special requests to create a staff schedule that works for everyone. This will help to prevent conflict, keep everyone on the same page, and ensure that your salon is always fully staffed. 

Marketing and PR

Getting the word out about your salon will be essential to your success. Marketing is a complex and daunting tax, so much so that many salon owners will shy away from it. If you’re in a prominent high-street location and see plenty of foot traffic, you might be forgiven for thinking you can avoid advertising, but this could be an unwise long-term strategy.

Every salon should be thinking about ways to scale its offering. This could mean moving to bigger premises to be able to accommodate more staff. Or it could mean opening an additional site in another area. You’ll never be able to achieve this if you don’t focus on developing your brand and your marketing.

Digital marketing

Most salon marketing activities will take place online these days. Customers find out about salons though many different channels, including social media, search engines and through dedicated salon sites like Treatwell.

Building a professional website is the best place to start. You should also create a Google My Business listing and keep it up-to-date to make sure your salon appears in map searches for salons. An online booking system will also help you to keep all bookings and customer information in one place.

By keeping your website regularly updated and making sure the content is relevant and informative, you could start to see something known as organic website traffic. This is traffic from search engines that originates from search terms that are non-branded. This means the visitors weren’t searching for your salon name, but instead for a term like “Balayage in Cheshire”. This type of traffic is very valuable as it can bring in customers that find you through Google. 

Social media

Your social media platforms should also be regularly updated, but don’t rely on this to run your practice. Many salons fall into difficulty by offering booking through the Facebook messaging service, but this can lead to double bookings and missed enquiries. Using a chatbot auto-responder can help you to redirect enquiries to the correct sources, such as your online booking form.

PR

Your PR strategy doesn’t need to be expensive, but you should think about how you can reach out to local press or bloggers. You don’t always have to offer giveaways to get their attention. Local press is often looking for local interest news pieces and will appreciate a well-written press release that outlines your plans for the salon could be just what they are looking for. If you’re not sure how to write a press release, try looking for a freelance PR specialist. A recent graduate will be able to do the job for a lower fee than one who is more experienced.

Stock and inventory

Retail sales can help to increase the average order value of every visitor. But how do you know what to stock, and how much? Take advantage of free samples offered by companies to get a feel for what your customers like. Customers love getting free samples and their feedback can help you to decide what products will be popular.

You will likely already have an idea about the hair care products you will use on customers, but make sure you have extra available for sale. Customers love to be able to replicate the results at home, and professional hair care products are proven to be worth the investment.

Around Christmas, Valentine’s Day and Mother’s Day, you might find that you need to increase your stock and provide themed gift baskets. This can be a great way to boost your income and increase your cash position. Remember that running a salon can be a careful balancing act. Your income won’t be the same every month, so bountiful months like December will need to make up for quiet months like January.

Customer relationship management

Keeping loyal customers returning to your salon every 3-4 months is a huge challenge, but it is not impossible to achieve. Through effective customer relationship management, you can keep them engaged and loyal to your salon. A customer loyalty scheme is one of the best ways to achieve this.

You could also use text and email marketing to remind customers to book an appointment automatically. Text reminders are also very effective for reducing no-shows which can be very costly to your business.

Running an efficient and well-managed customer database will make it easier to generate repeat custom. This is why choosing an online, cloud-based system is one of the most popular methods. This will keep your customer data secure and give them confidence when handing over their contact details.

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