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The secret to salon success with Basin Education’s Stephen Arrizza

The secret to salon success with Basin Education’s Stephen Arrizza

Stephen Arrizza is the co-owner of Basin Haircutters in Adelaide. Now in its 17th year and boasting a team of 22 staff, Stephen and Co-owner Mandy Mattiske have turned their attention to helping the country’s salons with their hugely successful education workshops. Read on as Stephen talks running a successful salon in 2019.

Paddling upstream

Over the years, I have heard many analogies about owning a salon. Perhaps the most memorable – and relatable – likens running a business to rowing a boat. So it goes… being in business is like rowing a boat up stream. If you stop paddling, you will end up going backwards. I know all the salon and barbershop owners out there know what I’m talking about!

When you find yourself in this situation, natural instinct is to put your head down and paddle harder and harder, or for us salon owners, try and do more and more clients and hope you turn a profit before you burn out or go bust.

After all this babble about boats and rowing, my main message is this: the day we dedicated time to work on, not in our business was the day we started to see some great change.

Let me show you how you can do the same in your business!

Turning a profit

I’m going to let you in on a little secret. Running a profitable business is all about knowing your numbers. Sure, there’s a little luck involved, but 99% of the battle is keeping an eye on your cash flow and acting accordingly. Shortcuts make this easy with their new feature Cloud Reporting!

Let’s look at the industry average costs for a reasonably successful salon.

  • Wages: 50% (Including super, sick days, holidays and down time)
  • Stock: 15%
  • Sundries: 15%
  • Rent: 10%
  • Remainder: 10%

Yep, if we get it all right, we might be lucky to see a 10% profit. Sadly, not many salons are even seeing that.

I was sure we could do better, so I decided to break down the big four expenses and see where we could reduce them without compromising our business or our team. Luckily for me, the range of reports available in Shortcuts made this as painless as possible.

What I want you to do is go and look at your own numbers. I mean REALLY look. Look at where cash is coming in, where it’s going out and figure out how you can operate more efficiently.

Number one client

I know, I know. It’s easy to get excited about a new client walking through the door. But the fact of the matter is, unless that client is earning you a healthy profit margin, they’re not helping your business.

The day we started to concern ourselves less with finding new clients and shifted our focus to our loyal, existing clients, our business turned a corner. To borrow from the boat analogy again, you could say that rather than trying to paddle harder, we decided to make our boat more efficient.

I want you to treat the time you dedicate to working on your business like your most important, favourite, highest spending client. That is to say you should treat this time with respect. In my business, we never move this time, we always go in with a plan and we make sure to achieve what we set out to do. At the end of this time, we also devise a list of items to action for the next time we meet so we always go in with a plan.

Here’s your homework

Now you know the secret to our success, it’s time to go out and implement them in your business! I want you to set aside some time to put down the tools, step out of the salon and think… really think about what you can do better.

Maybe you can tweak your roster to boost your team’s productivity? (Tip: your salon software reporting is great for pulling this data. Bonus points if you can access your reports remotely via the cloud!)

You will be amazed at how much you understand and what you are capable of doing in your business if you give yourself the time.