Retail Selling Can Save Your Bottom Line

A Guest Article by Melinda M. Minton of Minton Business Solutions

Retail selling can save your bottom line. In fact, the profits made from retail can beastronomical if you approach the opportunity in the right way. Susie Fields, founder of Salon Training International based in Oceanside, California is a licensed cosmetologist who formerly owned Passion A Salon in San Diego. Now she coaches salon owners, distributors and professional beauty sales teams. “When I opened my salon I thought I knew business. I had theories and formulas, and guess what? Many of them didn’t hold water in reality,” shares Fields. According to the Green Book industry standards report the average spa/salon has a $25 service ticket and a $3.25 retail ticket. This of dreary picture of retail sales could certainly stand some improvement.

“How many products do you use on your hair? At least two, right? Most people use both a shampoo and conditioner. Really the average number of products that a client needs just for their hair is four!! Who among us doesn’t use a styling aid and hairspray? Think about facial products. The typical 35 year old client needs a variety of makeup items PLUS a cleanser, toner, moisturizer, scrub and masque. $3.25 average ticket price…that just doesn’t add up for me,” says Fields. It is true that spa technicians simply are not selling much retail. The problem is multifold and the infection runs deep. Estheticians think that the act of selling products is a dirty, unnatural offense similar to selling used cars or fencing stolen watches in a dark back alley. The technicians who do not understand the need to equip their clients with home care are without the business savvy and systems necessary to increase and track their sales.

“We help professional beauty providers understand how to sell retail and how to run their numbers on a weekly basis to measure their sales success,” says Fields. Knowing how to measure an average ticket amount is relatively simple. Take your total service sales for one week and divide it by the number of clients seen. You can do the same with retail sales by totally up those sales numbers and dividing it, once again, by the total number of clients seen. Finding out how much each of your technicians make per hour is also simple. Take their total retail and service sales amounts and divide by the total number of hours worked and voila, that is what that individual makes per hour for the spa. Using this type of formulation with each employee as a coaching technique helps to motivate and manage an employee.

If a goal were to be set for retail it would have to be (AT LEAST!!) a dollar for dollar draw. A $95 facial then would have to sell $95 in retail. That would mean a hydrating balm and an eye cream. Selling those two products would be about as difficult as breathing. After a service is successfully executed, the technician is ‘queen.’ The client wants to maintain the look that was just created and if she could find the funds to come to your spa she surely can afford to enjoy the same pampering while away from the spa.

Deborah Barkley, a long time spa manager currently located in Honolulu thinks that education is key to selling retail. “I’ve worked a great deal with Sonia Borgosian at Biojouvance and I know that her training is the key to our retail success. Technicians have to know what they are selling inside and out. That very often is never translated to estheticians with many product lines,” says Barkley. The battle between spa directors and owners who want to make a profit and therapists who are natural client pleasers, however, is a deep chasm to jump. “Technicians are in the front lines and they speak, touch and interact with the clients far more than the rest of the management team. They need to feel comfortably managed and well-educated in order to perform up to the standards of spa directors and owners,” says Barkley.

Working retail into packages for lifestyle enhancement is one easy way to ensure retail results. For instance if a client is wanting to experience a body wrap that client can be redirected to a series of body wraps that include endermologie or lypossage, a counseling session with a nutritionist and a personal trainer as well as a home care kit. Home care like herbal supplements, bath soaks and cellulite diminishing body cream is just as crucial to getting results as the in spa services. If you market the package as a lifestyle enhancement session that lasts over a span of time including retail, there is very little that can go wrong. The same holds true for microdermabrasion sessions. A single microdermabrasion treatment is helpful but results are best realized when a series of treatments is done and when combined with appropriate home care to help soothe, hydrate and heal the skin.

Another method that has proven effective for several spas is the notion of having a top sales person work the retail area as a closer. The closer takes the client in a smooth transitional hand-off from the technician performing the client’s services. A home care routine is then devised from the notes that the technician has made based on her findings during the service. “We actually use a 3 part prescription like pad. The client gets one part, the esthetician files one part and the third part is used to enter the client data into the computer. That way when the client comes back and requires a replenishing of her home care the retail attendant can simply look up the specifics of that client’s routine,” says Cherrie Tymine of Body and Soul in Ontario Canada.

Although the method of utilizing a closer can be powerful, it does have some drawbacks. “We went through some transitional periods when we originally implemented the program. The estheticians felt like we had taken away their position as a professional. As a result they lashed out at the retail staff and the clientele got a hostile image of our staff,” says Tymine. The management at Body and Soul resolved the issue by adjusting the commissions to make both the esthetician and the retail salesperson responsible for the sale. “It really does take selling in the treatment room as well as selling in the retail area to complete the sale,” points out Tymine.

Yet another way to create a lucrative retail environment is to adjust the way that staff members are being paid. The common commission structure is a 50/50 split of the gross service sales with a 12% or lower commission on retail sales. Although this is a common payment setup within the industry, it makes for an unprofitable bottom line. Some spas have opted to plump up their retail sales by giving an hourly wage with the commission portion of the technician’s salary being as high as 30-40% of the gross retail sales amount. “We find that we keep the serious professionals and we lose those who aren’t willing to sell retail. Even with the labor shortage that this industry is currently experiencing, we find that it is worth it to sift through and then retain the gems,” says Christi Mokler of The Face Station in New York City.

No matter what method of retailing you try it’s important to remember that the spa industry didn’t invent the concept of selling. Tap into resources in your local bookstore for general business. The same tricks, formulas and methods that the general business population utilizes will also work in your retail area.

This Article was first published on: http://spas.about.com/library/weekly/aa120201a.htm