If you are finding that money is getting a little tight, that is a good indicator that your bills are starting to eat away some of your profits and something is out of whack with your numbers.
Your staff’s wages should be the first place to check and by using a simple wage checker, you can see if you are over staffed.
So don’t panic if you are. You don’t need to sack anyone just yet.
So a safe wage % should be around 35%-40%.
If you start going over 40% you’ll need to keep, an eye on it, you. You won’t want to be over 40% for too long.
Over 50% and you’re eating away a good chunk of your profits.
If you’re over 60%, then you need to take action fast.
On the other hand, if your wage % is between 30%-35%, then you are in what I call the sweet spot and maximising your salon profits.
To work out your %, divide your staff wages into your salon takings and then x 100.
This will give you your wage %.
If your wage % is high, it’s probably that you don’t have enough clients for the staff you have and you are over-staffed.
Now you need to act before it gets too high and eats all your profits.
You need to get new clients in as fast as possible.
Or you can work on getting clients that are overdue back sooner by tempting them with an offer or you can work with your team on the client journey and up selling services and products.
If you need help working out your wage % or ideas about how to get your wage % down, let’s chat.
Link to my calendar is below
Talk soon
Rich