Most owners believe that not having enough money is the leading cause of business failure. Frankly, they're right: cash is the life-blood of a salon/spa. Without cash, your salon/day spa cannot sustain itself. You won't see its tenth anniversary (82% of the million+ small businesses started each year in the USA never see it), unless you understand and do something about the nine reasons listed below.
Reason nine:
Absence of a standardized quality program.
Whether you are a one-man band or a multi-unit salon/day spa, you have to know customer number 101 will be as delighted with your service or product as customer number 1. Having a system that evaluates your salon/spa's quality will give you, your team, and your clients the assurance of the quality of products/services delivered.
Reason eight:
Lack of knowledge about the market and competition.
Who are your competitors and what do you know about them? What do you know about your target market that you want to attract? If you don't know, then you can't differentiate your salon/day spa from the competition. If you can't, then your prospective clients won't be able to either. Without differentiating your salon/spa, you've left your new clients coming to you by chance.
Reason seven:
Failure to communicate your objectives.
You will never reach your objectives if you do not communicate them. (Answer the question, "What are we aiming for?") Failure to communicate the objectives to your team members will result in anarchy, where everyone does their own thing instead of everyone working for one thing.
Reason six:
Poor market segmentation and strategy.
Who is your ideal client? Can you describe her? What do you know about her needs for your service or product? The less you know, the faster your cash will disappear and, the quicker you'll go out of business.
Reason five:
Over-dependence on specific people in your salon.
The specific person could be you or it could be someone else. No matter whom it is, the question you must ask yourself is, "What would happen to my business without that person?" Documentation on how to get specific, stunning results becomes critical. Let the systems do the work and the people run the systems!
Reason four:
Lack of financial planning and review.
How much does it really cost to open your salon/day spa's doors in the morning? How much does it cost to bring in a new client? What profit margin must you make to make it worth your while? The lack of financial planning and review has cost many owners their salons/day spas. How are your books looking these days?
Reason three:
Lack of management systems.
Your salon/day spa must require consistent guidelines for producing exceptional results through your employees. If this isn't true, then you have no management systems working for you. Your management systems allow you to move one-step closer to your salon/day spa being system dependent, not people dependent.
Reason two:
Lack of vision by owners.
It's always fun to dream about how things should be...but what if...? What if you knew exactly what you were building? What if your employees knew exactly the same thing? Without a vision, how will you know that you've gotten there? Without a vision, it doesn't matter where you end up, does it?
Reason one:
Owners concentrating on the wrong work.
This is a big one. Ask yourself, do you work ON your salon/day spa or IN it? Are you BUILDING a business or just DOING business? Are you really moving towards your personal goals? If your business depends on your being there, then all you really did was buy yourself a job. You must spend more time and concentrate on the strategic (see reasons two through nine) rather then the technical work of the salon/day spa. If you don't, who will?
By Andrew Finkelstein, The Beauty Resource www.thebeautyresource.com