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. . s s e n i s u b to n w Let ’s get do Never has it been so important for salon owners and managers to insure that every aspect of your business is performing as well as it can so that not only do you survive but begin to thrive. We’re delighted to present some of the latest thoughts and top advice on the different areas of your salon business as we aim to answer questions and present practical solutions to help you on your way.
Contents. . 4
ASK THE NHBF Frequently asked questions answered by the hair and beauty trade body.
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HELP WITH HIRING Phil Smith on recruiting the right staff.
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TAX TALK Mike Parkes on the impact of COVID on the next tax return.
10 STRENGTH IN NUMBERS Salon Business Services’ top tips to get more cash in the till. 13 FOR THE FUTURE Robert Eaton on apprenticeships. 14 SOFTEN THE BLOW A look at salon software companies and their stress-free services.
ASK THE
Your questions answered by the trade body helping salons and barbershops run successful businesses. The NHBF is the UK’s largest trade body for the hair, beauty and barbering industries. Since 1942, it’s been helping Members run successful and profitable hair and beauty businesses by providing advice, specialist support and tailored services to meet the unique challenges of running a salon or barbershop. Here are the five most frequently asked questions its Members Team Helpline receive. How can I handle staff holidays and absences? There are many reasons why your staff may need to be off work, from sickness and maternity to annual leave and emergency time off. UK law says all employees are entitled to paid holiday. Employees are entitled to a minimum of 5.6 weeks of paid annual leave. This means that a stylist or therapist who works five days a week should get at least 28-days’ paid annual leave. Part-time employees’ annual leave will be pro-rata depending on how many hours/days they work each week. NHBF Members can call for free expert help with annual leave entitlement. How can I follow the right procedures when dismissing a staff member? If you need to start formal or disciplinary action, dismiss a staff member, or make redundancies in your salon or barbershop, make sure you follow the right procedures and stay within the law. You must have written rules and procedures, so your employees are clear about what is expected of them, including their general conduct, levels of performance, and rules around specific issues such as the use of social media. They must understand what is acceptable and unacceptable and the consequences if they fall below the required standard. NHBF Members can access in-depth guides to managing performance WWW.RDR.LINK/HF001
How can I improve cash flow, so my business thrives and grows? Running out of cash is a major cause of business failure. Even a profitable salon or barbershop can fail because of poor cash flow. It is the single most important issue for any business. Cash flow is simply the amount of money you have coming in and the amount you have going out. The secret is to keep your eye firmly on the ball, and to do that, you’ll need a simple cash flow forecast. Don’t worry – this isn’t rocket science, but it is an essential part of your financial planning to help ensure you grow and prosper as a business. NHBF Members can access an in-depth guide to business finances WWW.RDR.LINK/HF002
How can I increase client loyalty in my salon? Gaining new salon or barbershop clients is important – but make sure this isn’t at the expense of your existing ones. Long-term loyal clients are the bedrock of your business, but you have to earn their continued custom. A good starting point is to do a short questionnaire to understand your customers wants and needs. If you don’t make your clients feel valued when they arrive for an appointment at your salon or barbershop, they won’t value you and may start looking around to see what is offered locally. Always do a consultation before every appointment. Always try to personalise your service. Make a mental note of clients’ comments during previous appointments. Loyalty schemes are a great way to keep your hair and beauty clients coming back. For example, a set amount of loyalty points per visit could lead to a discount on their next treatment. NHBF Members can access an in-depth guide into delivering an outstanding client experience WWW.RDR.LINK/HF003
How can I avoid cancellations and no-shows? No-shows and late cancellations are frustrating and can seriously affect your cash flow and profit levels. You can take steps to reduce no-shows and late cancellations, for example, by building good relationships with your clients. If they feel committed to your salon and valued as individuals, they will be less likely to let you down. Send out reminder text messages a few days in advance of the appointment. Salon software systems can be used to send out automated appointment reminder messages. NHBF Members can access an in-depth guide into handling no-shows and cancellations WWW.RDR.LINK/HF004
Not a Member? Quote PHD25 before the end of November to receive a £25 discount on your membership fee. WWW.RDR.LINK/HF005
Watch NHBF latest promotional video on YouTube. WWW.RDR.LINK/HF005
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If you’ve been struggling to recruit good stylists, finding that most candidates either have unrealistic salary expectations or the wrong work ethic, you are not on your own. Phil Smith has built salon empires and won countless awards for his business acumen, and he’s here to help with your hiring issues.
HELP
WITH HIRING The recruitment picture in the hair industry has changed and at the moment it’s especially challenging. If you ask me, this is partly driven by the rise in self-employment. Latest statistics show that 54 per cent of people who work in hairdressing and barbering are self-employed.* This figure has grown significantly. Add to that the fact that there are less people starting apprenticeships (a drop of 13 per cent* according to latest research) you start to understand what’s fuelling the problem. It wouldn’t be overly dramatic to suggest that there is ‘a recruitment crisis’. As well as a shortage of people, as salon owners we are completing for staff with the right skills. And yet, we need good people now more than ever as our businesses recover. The question is, how do we find them? I took a decision around eight years ago to alter my business model. Rather than a fast-paced, target driven, high pressure environment, my goal was to create a salon where service and standards - rather than profits - came first. I decided there must be a better way to achieve and measure success. This touched all areas of the business and more recently I’ve begun to consider how and where I recruit new staff. In fact, the answer for me has been to go back to basics. By reaching out to schools and targeting school leavers, we’ve managed to find young, keen candidates. My current team all joined me as juniors. Yes, it takes more investment in training, but I’ve been rewarded with loyalty and longevity. Rather than a three-year apprenticeship, we complete our training in 18 months. I believe in paying a decent salary from the outset and the rest goes into a pot which funds further education. At the end of the 18-month apprenticeship, all recruits go on a course that polishes up their skills. The pace of life – not just careers, but clothes, cars and lifestyles – applies to training and we have to accept that there are very few people who are prepared to spend three years folding towels and sweeping floors. It doesn’t mean that I’m willing to compromise on high-quality candidates. Recruiting from ground level means your team members are joining without any technical
hair experience. But rather than being a disadvantage, I see that as an opportunity. For me, talent spotting has never been about who can do the best haircut. The right junior is always the one with the best attitude. I measure potential in staff by their conversation, work ethic, commitment, enthusiasm and initiative. I’d say you can tell almost instantly whether a recruit has what it takes to make it to the top. Once you’ve attracted the right staff, it’s as much up to you as them to keep them there. Don’t assume it’s just about salary. What do YOU offer above and beyond any other salon on the high street? I’ve always had a philosophy that as soon as someone decides to work for you, you work for them. When anyone comes on board, it’s my job to make sure each person has what they need. Everyone has different driving forces and I make it my business to find out what they are. If staff know you’re working for them, I’ve found they’re far more likely to come to you with what they need and be open about any issues. At Smith England, we also keep the team motivated with opportunities for growth and development such as awards, photoshoots and experiences outside of the salon. It develops their skills and drives their ambition. In today’s world, staff are more and more focused on flexibility and being in control of working when and how they need to. Rigid structures are a thing of the past and I’ve had to adapt my business to accommodate this. Longer holidays and time off based around school terms are two areas that come up time and time again. Similarly, I allow the team to run their own columns. They know their capacity and I trust them to find their own limits. If you have someone good who works hard, you need to find a way to strike a balance. In short, you have to see your team as your salon’s greatest asset. Investing in finding the right people and keeping them with you does pay off. And, don’t forget, by listening to your team and creating a job they enjoy showing up to, they get what they need and – importantly – so do you. * Statistics according to NHBF 2019
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TAX TALK
Mike Parkes of GoSimpleTax explains the impact of COVID-19 and how it will impact the next tax return.
When the Government’s emergency support measures were announced last year, the Self-Employed Income Support Scheme (SEISS) provided a vital lifeline for many self-employed hairdressers. The grants – five in total – have helped to plug a much-needed financial gap created by enforced closures and months of national and regional restrictions. The scheme, which was designed for those who have lost income due the COVID-19 crisis, has been combined with dispensations, such as the option to defer the second payment on account for the 2019 to 2020 tax year until 31 January 2021, VAT deferrals and the option of paying by 11 monthly instalments, as well as the extension of the self-assessment tax deadline. While the SEISS has not been without its critics – coming almost a month after the Coronavirus Job Retention Scheme (CJRS) was announced, with a significant number of people falling through the eligibility cracks – it has provided greater support for the self-employed market. However, the reality is that hairdressers will be feeling the effects of the coronavirus pandemic long after support measures are withdrawn and scaled back. A recent survey carried out by GoSimpleTax showed that 85% of self-employed workers believe the Government should provide greater support, with 27% of sole traders seeing a fall in revenue and a quarter experiencing restricted trade. Interestingly, it also revealed a certain amount of confusion around the SEISS funding, with nearly half of self-employed workers saying they don’t need to declare COVID-19 grants in future tax returns. Emergency financial support, such as the SEISS and the Small Business Grant Fund (SBGF), are subject to Income Tax and Self-Employed National Insurance and any government support received during the pandemic must be included in the 2020/21 tax returns, under HMRC rules. This also applies to taking a paid job or applying for state benefits for the first time, as a result of the pandemic. Not doing so could leave people open to potential penalties from HMRC, as a result of failing to include all sources of income. Penalties cover: Careless behaviour: between 0% and 30% of the extra tax owing Deliberately underestimating your tax: between 20% and 70% for deliberately underestimating your tax And deliberately underestimating your tax, which is then concealed: between 30% and 100%.
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It’s essential to understand the implications and tax liabilities that come with these emergency measures and to file your 2020/21 tax return as soon as possible. It’s important to include details of all your income, even if tax has been deducted at source – don’t wait until January 2022. Filing early will offer confirmation of your tax bill, allowing you to plan for tax payments that may be due in January and July 2022. While 2020 has placed immeasurable pressure on people’s earnings, the fact still remains that crucial to avoiding debt is ensuring you put away a minimum of 15%, maybe more depending upon the nature of the business, of sole trader earnings to help cover tax bills and avoid any nasty surprises. Mike Parkes is Technical Director at GoSimpleTax – the online tax return and self-assessment software.
STRENGTH IN NUMBERS Why one distribution company’s commitment to supporting salons could save you £££! SBS is a distributor seeking to support salons by bringing together a wide range of specialists, alongside sourcing and supplying the best exclusive sustainable and vegan products. With expert industry knowledge and a bespoke approach to each customer, SBS’s founders have listened to salon owners about their biggest headaches and barriers to growth, and looked to solve this with handpicked partners across HR, legal, insurance, software, operations, marketing and more.
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Looking good Make the most of your shop window and retail area with stunning digital signage and a fully managed content system - shop windows offer an incredible free marketing opportunity, especially in high-footfall, high-traffic locations. Display your own branding, retail products/brands, hair creations and more on a showstopping screen that will capture the attention of all who pass by. Cloudomni are SBS’s technology service partner who have industry leading products and services in telecoms, broadband, Wi-Fi, computing, digital marketing and business utilities. Claim your free business service and technology audit from cloudomini – you could get up to 30% off your bill here! WWW.RDR.LINK/HF007
Measure up Think you’re on top of your colour waste? Top sustainability ambassador Karine Jackson did, but when she trialled Vish she was shocked to discover that her own waste was 7%, with the salon as a whole at 16%. Most salons are above 20% going down the drain! Installing Vish’s revolutionary Bluetooth scales saw her colour waste drop to just 3% and the salon’s overall waste to 7% – a reduction of more than 50%. A win not only for her business but for the environment too. Vish Colour Management will liberate your team from worrying about the maths behind a formula, and allows them to fine-tune it to the tenth of a gram without calculating ratios – no more rounding up to the easiest quantities. The formulas are then recorded on the POS system at the front desk for the client’s next visit and can be integrated into your order system too. To launch SBS’ partnership with Vish, for a limited time, Vish and SBS will fund your scales and set-up, valued at over £490. Click here to find out more. WWW.RDR.LINK/HF008
Check your cover OK, it’s not glamorous, but ensuring you’re properly covered in your business is an essential part of salon ownership. Mike McNulty, MD of Stephenson’s Risk Management says “Read your insurance policy carefully, particularly regarding requirements for patch testing. This is particularly relevant in the light of the recently reported allergic reactions experienced by clients who have contracted COVID. Pay particular attention to ‘housekeeping’ – mop up any spillages, and be careful with trailing leads – many insurance claims result from slips and trips. If you own your business premises, with the recent spiraling costs of building materials it’s a good idea to obtain a current professional rebuild valuation for your building, to ensure your sum insured is adequate.” Find a package of relevant insurance covers with an A rated insurer at very competitive rates of premium, which have used our economies of scale to negotiate excellent cover and terms for salons here. WWW.RDR.LINK/HF009
BOOK A CALL WITH AN SBS EXPERT NOW TO SEE HOW THEY COULD SUPPORT YOUR SALON BUSINESS GROWTH 0330 320 6000 / info@sbs-hair.com
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ONLINE DEPOSITS: Switch on online deposits to decrease your no-shows by up to 65%!
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FOR THE FUTURE Multi award-winning hairdresser, Robert Eaton, Ambassador for Wella and Creative Director for Russell Eaton Salons knows a thing or two about Apprenticeships, and here he explains how they are not only the future of the industry, but the future of your salon.
Apprenticeships are the future of our industry and I believe they should play crucial role in any hairdressing business. I’ve always been passionate about taking on apprentices - we currently have 11 trainees working between our two salons, which ensures they have the experience of learning in two completely different environments (Leeds city centre and Barnsley). The future of your salon I would encourage any salon owner to consider taking on apprentices - they are not only the future of the industry but the future of your salon. It’s so important that the next generation of hairdressers has the same grounding that we did – those fully rounded skills that we learned are essential, so it’s vital that apprenticeships are protected and don’t become too diluted. Apprenticeship schemes are incredibly rewarding – not only for the apprentice themselves but for the team around them who can play a large part in nurturing their growth and success, as well as enjoying the new energy and creativity that an apprentice can bring to a salon. When an apprentice joins a salon as a school leaver, they’re immediately adjusting to the work environment which is invaluable in all areas of the business. They learn how to improve their people skills and how to communicate effectively, plus they’re also picking up knowledge and insight that they will carry with them for their entire career. It’s a real-life education and these are the day-to-day experiences that you can’t learn in the classroom or a traditional academy. It’s a very exciting time to be an apprentice Although applications for apprenticeships are said to be declining, it’s not something we’ve yet seen evidence of at Russell Eaton. We always have a lot of applicants, perhaps because our Barnsley salon has been established for over 40 years and people see that as a strong opportunity. I’ve found that the apprentices that come to us are already committed to wanting to do well and know exactly what they are looking for education-wise. It’s a very exciting time to be an apprentice – it’s never been easier to access training, inspiration and information, which allows apprentices to get a really broad education, but I don’t think anything beats learning as you work on
the salon floor. For me, it was a great foundation for my future career. The financial incentives that are in place for supporting apprenticeships are of course helpful for any business. Providing a decent level of training can be costly, so any level of financial assistance is always welcome. Taking on an apprentice is also more cost-effective in the long-term than hiring trained staff; the Learning and Work Institute for the Department of Education states that ‘homegrown’ apprentices tend to be loyal and more likely to remain with their employer, saving you future recruitment costs. Training someone from scratch also ensures that they are fully immersed in your salon ethos from day one, helping them to fit in with your team and making it easier for them to contribute to your salon’s success. A fresh perspective Taking on apprentices can be a very difficult decision to make; by employing someone, you become responsible for providing them with education and opportunities to help and support them throughout every stage of their career. But in my experience, the advantages outweigh any concerns as apprentices can help breathe new life into your salon team. I have found apprentices to be focused and dedicated, bringing a fresh perspective to the business. It’s a great opportunity to get existing stylists involved in mentoring too and watching your trainees progress is incredibly rewarding, both from a business and personal point of view. Right now, I am concerned that across the industry there’s a lack of opportunities and positions for apprentices. Not only are there fewer salons on the high-street, but there are also a lot more freelance stylists and together, this results in fewer positions for apprentices, so it has become a really competitive market. I would love to see people with home salons or those who are freelance make a real effort to try and support people who are embarking on their career as hairdressers, even if it’s just the offer of work experience. It’s crucial that the next generation of our industry doesn’t get overlooked due to lack of opportunity. Every hairdresser started off as an apprentice and we have all benefited from the training an apprentice receives, so we really need to take this seriously and think about the next generation and what we, as an industry, are offering them.
SOFTEN THE BLOW Running a salon can be tough without the added strains of managing diaries and marketing your services. These salon software companies take all of that away, with all-encompassing platforms and extra special features, allowing you to get on with what you do best.
to t h g i a tr s d a e h to s Click the link for more info. . the brands’ sites TIMELY exists to grow the value of the beauty industry. Its inclusive community of over 55,000 beauty professionals use Timely to manage, protect and grow their business. Not only does it offer beautiful business management software, innovative marketing tools, seamless integrated payments and award-winning customer support, Timely customers get access to education from the biggest industry names globally. Timely's flexible pricing and tailored plans are designed to suit businesses at any size, stage and budget. And, they won't lock you into a contract, or hit you with hidden costs. WWW.RDR.LINK/HF010
SALON TRACKER is a salon software system designed for businesses in the hair industry, providing them with a management solution to help run their salons. The company are dedicated to growing businesses by winning customers and improving profits. Features include Appointment Scheduling, SMS Reminders, Intelligent Marketing and Online Booking. Salon information can also be accessed from home through the HQ and Siteview features. Salon Tracker pride themselves on great customer service and ease of use. There’s always someone on the phone to talk through any questions you may have and the company offers a free two-week trial period with no obligation. WWW.RDR.LINK/HF011
SALON by Premier Software® has been specifically designed for the hair and beauty industry. Not just a scheduling system, Salon provides the insight you need to ensure your salon is a true success. With features ranging from social media integration, automated marketing, and loyalty schemes to online booking, staff management, and automated reporting, Salon puts your business a cut above the competition. WWW.RDR.LINK/HF012
BOOK IN BEAUTIFUL (BIB) provides online booking, marketing and consultation forms. Every salon gets a free website and BiB can even build you your own custom-made app available on the App and Play stores. BiB has features built specifically for hairstylists, such as support for complex bookings like services with development time, customisable service times, automatic appointment cancellation refilling and easily organisable online consultation forms. WWW.RDR.LINK/HF013
SALONIQ is the complete booking, management and marketing system for salons and was built by salon owners for salon owners. With over 2,000+ UK salons, 100+ award winning salons, 180+ salon groups, SalonIQ is a fast growing choice for salons in the UK. SalonIQ is a technologically forward thinking and innovative company that embraces change, and always looks for the opportunity to deliver more and give salons the best ROI possible. With tools such as salon marketing, team engagement, online training, point of sale and much more SalonIQ aims to do the best for its customers, whether that be with intuitive software, or great customer service. WWW.RDR.LINK/HF014
MEEVO 2 salon and spa management software has time-saving features and customised design to help you overcome challenges and achieve success. It has a patented virtual assistant that offers voice recognition and natural language understanding to help you navigate the software, quickly book appointments, bring up reports and so much more. It also has built-in email marketing and powerful security controls to keep your business secure 24/7. WWW.RDR.LINK/HF015
BOOKSY is an all-encompassing software brand offering businesses a one-stop solution for all your admin needs, including booking customers, managing diaries and marketing your services for a low-cost monthly fee. You can even create your online shop front via the Booksy Biz app, with services, reviews, portfolios, and contact details all readily available to attract customers. Booksy also has a separate app for its customers, letting users book, pay for, and manage their next hair appointment in seconds. WWW.RDR.LINK/HF016
PHOREST Salon Software helps you manage, market and grow every facet of your business and it’s trusted by over 100,000 salon and spa professionals. Its goal is to get your clients back in more often, spending more and generating referrals! Phorest’s tools are designed specifically to help you manage and empower your team, reduce no-shows, and market and showcase your work. Phorest offers a top-class marketing suite, 5* online reviews, online booking, a salon branded app and much more. You do hair and they’ll do the rest. WWW.RDR.LINK/HF017
TREBBLY helps you engage your customers and keep them coming back for more, with a bespoke, digital loyalty reward system tailored to your vibe. Offer rewards your way using the incentives you choose and engage customers with the in-store touch terminal. No more cost-busting ‘stamps’ or cashback! What’s more, Trebbly connects with all of your business’s key social media and marketing platforms, such as Facebook, Instagram, and Google My Business, to give your marketing a boost. WWW.RDR.LINK/HF018
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