Written by Ken Cassidy, principal of Kassidy's Salon Management Consulting Company:
Retailing is a word most staffers don’t like to hear regardless of whether you have employees or renters. Every owner needs to truly understand the real value of retailing as a service. There are three critical points of view. The owner’s commitment, their distributor’s commitment and the staff’s commitment. When all are in agreement to make the commitment to our most valuable asset, the client, it’s they who really win. This commitment puts your company above the rest and it’s what changes all the rules of success and survival.
Everyone needs to know the real value of building a clientele and maintaining it through offering retail as another professional service. Few understand the true value of a retail service so we will make it real simple for all to understand as to help overcome the fears of Rejection vs. Success.
First off, the fastest way to build a clientele is thorough retailing service for one simple reason, the client who purchases retail products from you is without a doubt the most loyal client in your business. She/he will book their next appointment when they leave, have multiple services within the business, refer more of their friends to your business and the really good news is, they spend more of their hard earned dollars with you. All it takes is the education on how and when to approach the client with recommendations for a take-home regimen to maintain their hair, skin or nails, regardless of the service you offer.
Asking for a sale is like asking for a date, not everyone is going to say no and the greater sincerity one possesses, the greater the value you have created with your client for longevity. This retail service approach needs to be followed up at the next client visit to see how she/he liked the product you recommended and did it meet their expectations. If they were unsure about the product, 90 percent of the time it was because it was used incorrectly and now you have the opportunity to reeducate them on the proper use.
From that point on, all we do every time the client returns, is ask them what they need to take home with them from each visit. Of course we should be making recommendations of other products they can benefit from, that have not previously been recommended or purchased. This is why your retailing and gift certificate holiday campaigns continue to grow beyond the holidays and we haven’t started talking about gift certificates yet.
Since we’ve approached the subject of gift certificates and/or gift baskets, what if you gave a client that purchased a gift certificate a free travel size shampoo or conditioner as a gift for purchasing the certificate? There again, if they like the product, they will purchase it from you if you do your follow up homework. Another option is give the purchaser a donation card with 20 percent off any service your company offers. The donation, or discount, criteria is it needs to be used with in the first 45 days from December 31, 2010.
Now for the financial value of offering retailing services for each staff member regardless of their service they offer or their title within the salon/spa. We, as an industry, must look at the way we have been compensating our staff regardless of what we call them. You know Employee, Booth Renter or Independent Contractor. There is no real financial motivation for them to do better than the national average of 10 percent, Whoopee. There must be incentives for those who are doing well at offering retail services in our business to do better than they already are doing and goals for those who lack the confidence to receive rewards as they improve.
Sadly each owner that is paying a flat 10 percent doesn’t ever realize they actually paid their staff 20 percent. To this Educational Management Consultant, there is no profit to pay commissions, bonuses or a flat dollar amount on a sale until the cost of the product has been deducted. Then we are compensating retail rewards on the profit margin for doing a good or great job to our staffers.
Offering retail compensation that is tied to their services can be a good incentive for some owners. But it can hurt the new staff that do not have a following as of yet. Quite often the newer staff sells more retail then they produce in services. Take a look at what you are doing in your business when it comes to retailing as a service and ask yourself “Am I happy with my company’s results?”