Is your salon setup to make a Million?

One of the salon business tools Nexus Revolution use to take the guess work out of your salon's potential to profit is our Salon Calculator.

The Salon Calculator works out:

1. How many active clients you need on your database to produce your desired income.
2. How many of these need to visit each hour for your team's column productivity
3. How many Full/Part Time team members you need to service these clients based on your opening hours
4. What your return on income is after basic wages for your length of trading hours

Take a look at the results of this sample case study; to see what the salon would need to do to make a £1,000,000 turnover.

Salon 1 – Has 10 cutting stations. Opens 5 days, for 8 hours a day. 60 minute appointment times are allocated to deliver a £45 cut and finish. The team average being booked out 80% of their available time. (This means there is 96 minutes unallocated in each column to schedule rest breaks throughout the day without reducing productivity further.)  On average the active clients in the salon database return every 8 and 2/3 weeks, which is 6 visits a year (52 weeks ÷ 8.67 weeks between visits = 6 visits a year). Full Time team members are employed 8 hours a day, 5 days a week for 46.4 weeks a year to allow for 5.6 weeks paid annual leave. The average pay rate for the members doing the £45 cut and finish is £8.00 per hour.

1. To turnover £1,000,000 based on £45 cuts across an active clientele returning an average 6 times a year, the salon would need at least 3704 clients such as these.
2. However at £45 for every 60 minute appointment slot the salon would need to see 14 clients in salon per hour. Unfortunately this salon only has 10 cutting stations. (Even if the team worked at 100% productivity the whole year, the salon would still need to see 11 clients each hour!) 10 stations limit the salon to £748,000pa based on this most performed service at the current price, duration and total trading hours.

So what is the best thing to do assuming the salon itself can’t be made to fit the 4 additional stations required?

OPTION A – Increase service price?
OPTION B – Decrease service time?
OPTION C – Increase trading hours?

If the salon changed nothing and reached its current revenue ceiling of £748,800 it would need to employ at least 10 Full Time and 1 & 1/8th Part Time qualified members costing £166,400 in basic wages before bonuses. Income after wages will not exceed £582,400.


Option B – Decrease service time in this example returned the most income but must be weighed against the extra pressure on staff to run to time without reducing the quality or service experience of the client.

Reducing service times is not always an option. Had the service most performed be a 45 minute massage service that occupies a treatment room with a 60 minute appointment slot, we cannot expect to service more than 1 client per hour in this work space. In which case Option A – Increase prices should be considered before opening longer and significantly increase your wage bill.

Whilst on the topic on service times, it is worth noting that increasing the popularity of profitably priced 30 minute services will have the effect of halving the number of team members required. For example in the above example, £45 cuts completed in 30 minutes, would require only 4 Full Time and 3/8ths Part Time qualified members (that is a casual employed 3 hours for every 8 hours trading) grossing £1,048,320 at a basic wage cost of £66,560 to return £981,760 after wages.

A Nexus Revolution Salon Setup Benchmark Review would also input your other cost centers of Rent, Stock, Operations, Marketing etc to forecast your profit potential. Follow the link below to arrange a no obligation consultation.

© 2011 Wayne Kranz & Nexus Revolution Trust http://www.nexusrevolution.co.uk