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Management Practices

The Best Staff Retention Tool

Stacey Soble | May 26, 2016 | 9:49 AM
Anthony Garubo says you can keep your stylists away from the lure of higher commissions and rental by making them financially successful.

Anthony Garubo, owner of Anthony Garubo Salon in Maplewood, NJ, learned the hard way how create a staff that would stay. “Decades ago, I was arrogant, and I had a devastating walk out,” recalls Garubo. “Now, I know I don’t have to be right; I just have to do what is effective.”

Today, Garubo has a $3 million-plus business with 17 stylists, nine of whom make over $50,000 annually. Of those, four make over $100,000 annually. And, he’s lost just one person in 20 years. How did he do it? Through systems that ensure his employees have a great income and common corporate-world benefits. Here are his essentials:

Create a Financial Career Path. Garubo’s trainees are paid minimum wage; once they’re on the floor, they get $10/hour. Then they quickly build in increments. Initially, Garubo paid 45% commission when a stylist reached $1,000/week and raised commissions in 5% increments for every additional $500—up to 55% when a stylist reached $2,000/week. Recently, he hired Mark Donovan, president of Broderick Consulting in Ridgefield, CT, to simplify his system with a top commission rate of 50% for new stylists. “You need a true career path to create $50,000-plus stylists,” notes Garubo. “Ours raise their prices based on pre-booking three weeks in advance and reaching specific retail and retention numbers.”

Build Them and They Will Stay. To build those new to the floor, Garubo initially paid for ads that ran at a movie theatre down the street. The first 100 people to visit the retention-trained stylist got a complimentary cut. Garubo also sent out postcards and posted in-salon signs, which caused established clients to make referrals habitually. Now, there’s no more need for ads, and clients refer about 125 new clients a month.

Be a Salon With Benefits. After two years, full-time stylists get two weeks of paid vacation; after six years, they get three. The pay is based on their average salary for the previous six months. They also get paid holidays, as well as 401K and health care options. (The salon pays $125/month toward health care when stylists meet their goals.) “Most of this is financed by retail, which is 13% of service,” says Garubo.

Boost Education. Garubo pays for half of approved outside education and has “tons of points” stylists can use at the Wella Studio, NYC. Most recently, he hired a full-time education director.

“Education helps stylists reach goals, but what I really learned about building a staff is that money matters and humility makes a difference,” says Garubo. “I used to go over numbers; now I ask stylists why goals were or were not met, and where they need support. I see my staff in terms of possibility and potential, and coach them one-on-one. Money is the by-product of showing them love.”

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