Your Wonderful Wake Up Call!

2020 has started off on the wrong foot for everyone, especially personal services business owners. With forced closures in many Countries due to COVID-19, many of you are faced with the grim reality that your business may not survive. In my opinion, this has been a much needed wonderful wake up call for our industry! I too own a salon. We waited until absolutely necessary to close, but did before we were given an official order to do so. Our clients began cancelling appointments after the social distancing requirements were announced and, since we could not operate within these requirements, felt it was our social responsibility to close. Was I scared? Yes, because I know I do not pay into Employment Insurance and was having to walk away from most of my income. I was not worried about the salon. Why? Because we have no debt so I knew that any debt we would assume due to this closure would be manageable. We also immediately implemented our success-proven strategy to generate cash flow, which provided us with a cushion for paying bills and staff when we return. We closed and I was able to breathe, process the quick turn of events and focus on my family in a time when I needed to do all of that the most. Were you able to close without worrying about your business? If not, this is your wonderful wake up call! I spent a full day preparing for the closure filled with administrative work, cleaning and marketing. I then spent over a week online, glued to the screen, following our government to keep my industry peers updated on any announcements of financial aid. Our government (Canada) was quick to put many of mind at ease about personal benefits, subsidies and deferrals. We are still waiting on more financial aid for business, as the loans/wage subsidies offered do not apply to many small business models or businesses that can not remain open during this unprecedented time. As I shared info on many of the industry pages I follow on facebook, I noticed a community coming together and supporting each other (I think we, as an industry, have always been one of collaboration over competition). What dismayed me, were multiple posts on these pages from chair and booth renters asking if they were still required to pay their rent. It really opened my eyes to the fact that so many of these chair and booth renter stylists want to and claim to be self employed but do not seem to understand the responsibility that goes along with that. They are happy to remit taxes as a self employed person and take advantage of all their write offs, come and go as they please, take holidays whenever they are so inclined and work without any direction yet when it comes to a business crisis these self employed stylists were some of the first to turn from their contractual obligations as business owners (yes, as a chair/booth renter you are a business owner). Many were actually insisting that they should not have to pay their rent. In this circumstance, the salon owner is still on the hook for their rent (they may get a deferral or some sort of relief they could pass onto their renters but they are still responsible for paying it). Insurance will not cover revenue losses due to an "Act of God" and most commercial leases include a "Force Majeur" clause rendering the landlord non-liable, however the tenant is still required to fulfill their obligations under the lease. Some of these stylists clearly did not fathom the thought that, if they do not continue paying their rent (or work with the owner to devise a deferral and repayment plan), there may not be a salon for them to go back to. Are you a self employed individual who understands and accepts the risks of running your own business? If not, this is your wonderful wake up call! So, assuming that everyone reading this is a responsible and integral business owner, how do we move forward to ensure that we are able to re-open regardless of incurring debt from this pandemic? No matter your business model (salon owner, chair/booth renter) there is no better time than NOW to assess your systems and plan for the future. 1. RIGHT NOW you need to generate some cash flow and cut expenses. I shared a great tip (offering Mini Memberships) on our facebook page You do not have to take to selling your clients hair colour or renting out hair cutting equipment and providing hair cutting tutorials (I am going to assume there would be some liability concerns around this anyways), you can actively promote GC and product sales online. Remember that Gift Certificates are a liability so this money should be saved to pay small supplier/insurance/utility bills while you remain closed and staff when you reopen. 2. You need to complete/adjust your budget. A budget was always, and is now, an absolute necessity. You MUST know exactly how much it will cost per month to run your salon and repay any expected incurred debt so that you have a clear picture of how much revenue needs to be generated each month. Preparing your budget also allows you to look at your expenses and trim/re-negotiate where necessary. Are your phone/internet bills quite high? Call your service provider and see if they have any new bundle offerings that you could take advantage of. These companies always seem to come up with something when you threaten to leave to do business with someone else, so ask for a loyalty reward instead. It may also be a great time to look into a new credit card processing partner if your rates are too high. Your revenue projections will help to develop your marketing strategies. 3. Do not stop marketing. You should continue with social media posts, monthly newsletters and blog/website updates. We are running a "Show Us Your Roots" contest, the winner will take home a $100 GC to use for their next colour appointment. You could also reach out and work on creating alliances with other local small businesses, which increases your marketing audience. This would also be a great time to complete your marketing calendar for the rest of the year. The quickest and easiest way to earn revenue is to increase retail sales, be sure to include some retail promotions in the mix. 4. Keep in touch with your teams. This goes without saying that you must keep them in the loop re: your marketing strategies and plans for the future. Your team members (including your booth/chair renters) need to feel secure in the fact that they will have a salon to return to. Share virtual education, get online for some Zoom chats, ask for their marketing ideas or opinions on changes they would like to see when the salon reopens and make sure they know that they are an integral part of your business success.

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