HAIRBIZ Year 17 Issue 6

Navigating Financial Challenges Through KPI’s A Real-World Guide For Salon Owners. By Kate Henderson – Elysium Hair Brisbane

Like many salon owners, we at Elysium Hair Brisbane initially believed that providing an exceptional guest experience would naturally lead to financial prosperity. It was a hard lesson learned through negotiations with the ATO and multiple moments of doubt that delivering an excellent guest experience, while essential, is not the entire equation for financial success. A Journey of Continuous Learning

Our search for financial stability led us to seek mentorship through the Australian Hairdressing Council. These learning opportunities, whether under the guidance of industry leader Sandy Chong or through financial courses by Belinda and Carl Keeley, have been transformative.

Tracking the Right KPIs: It’s More Than Just Numbers

While it’s common to focus on Average Sale, Client Numbers, and Visit Frequency, it’s crucial to remember that these are outcomes influenced by prior actions. • Utilisation and Revenue Per Minute: At Elysium, we set achievable targets based on 70-80% occupancy, with revenue coming 12% from homecare and 88% from service sales. • Team Targets That Motivate: Unrealistic 106

Hair Biz Year 17 Issue 6

goals can be counterproductive. We’ve instituted a ‘personal best’ commission system that encourages growth while keeping the focus on attainable milestones.

Pricing for Profit, Not Just Covering Costs

Thanks to Belinda and Carl Keeley, we adopted a calculator that takes into account various factors to sustainably price our services. This single change has had a considerable impact on our financial health.

Best Practices for KPI Monitoring

• Relevance: Choose KPIs that align with your specific objectives. • Achievability: KPIs should be SMART— Specific, Measurable, Achievable, Relevant, and Time-bound. • Consistency: Regularly reviewing KPIs allows for quicker strategic adaptations.

The Holistic Financial Approach

We see our suppliers, such as L’Oreal and Ozdare, not as mere vendors but as partners in our ongoing journey toward greater financial stability. Similarly, we aim to provide for our team’s financial well-being as diligently as we do for our salon’s. Financial challenges can be daunting, but they’re also an opportunity to grow and adapt. Through mentorship, a comprehensive KPI strategy, and a team-oriented approach, we’ve managed to navigate financial pitfalls successfully. And we believe that with the right tools and mindset, so can other salons. Kate Henderson @elysiumhairbrisbane