Salon and Spa Owners - Be Interested, Not Interesting in your Interviews!
The purpose of interviewing is to learn more about the service provider or receptionist; her skills, knowledge, education, experience, and cultural fit; and assess her interest in your salon/spa. Then why do interviewers talk so much?
Two factors that are critical to professional networking, developing mutual relationships, and influencing people are the art of listening and the genuine interest in other people. This is especially true when you are a recruiter or interviewer.
The purpose of interviewing is to learn more about the service provider or receptionist; understand the service provider or receptionist's skills, knowledge, education, experience, and cultural fit; and assess the service provider or receptionist's interest in your salon/spa. Then why do interviewers talk so much?
I know interviewers are excited to talk about their salon/spa and sell the opportunity, but research shows that interviewers talk too much and do not listen enough. I interviewed 100 executives to better understand how much time they spend talking versus listening during an interview. I found that 65% of the interview time was spent talking about the salon/spa and selling the salon/spa to the service provider or receptionists.
You can always tell which managers talk too much during the interview. Their interview notes are short, they can't tell you much about what they learned from the service provider or receptionist, and their recommendations are often a gut feel.
However, listening skills and general interviewing skills need to be taught. It is critical that you identify the best staff to conduct the interview, train them and then provide them with the tools to be effective interviewers. Here are a few guidelines to follow.
1. Select your interview team.
Not everyone can or should interview service provider or receptionists. I recommend developing teams of interviewers comprised of those who best represent your salon/spa, those who best represent the position to be filled, and those who have the best ability to assess a service provider or receptionist's fit in the salon/spa and position.
2. Train the interviewers on interviewing skills.
Interviewers need to understand the role of an interviewer and what is needed to be an effective interviewer.
The role of an interviewer is to promote the organization and attract the best possible service provider or receptionist, gather information about the service provider or receptionist, assess how well the service provider or receptionist's qualifications match the job requirements, and determine whether the service provider or receptionist will fit in with the organization and the staff. It is critical that the interviewer is an effective listener.
The first skill in being a good listener is acting like a good listener. Business has taught us to tune out much of the information that is thrust at us. It, therefore, becomes important to change our physical body language from that of a deflector to that of a receiver. Facial expressions are a critical component of body language. Interviewers should lean toward the service provider or receptionist to show interest.
A second skill is to establish eye contact. Our eyes pick up the nonverbal signals that all people project when they are speaking. Eye contact completes the connection. A service provider or receptionist will work harder at providing information when they see a receptive audience.
When the interviewer has established eye contact with the service provider or receptionist, interviewers must then acknowledge the service provider or receptionist through additional body language. An occasional nod of the head will indicate that they are following what the service provider or receptionist is saying. Ther will also improve the level of concentration during the interview.
It is extremely difficult for an interviewer to receive information when the interviewer is talking at the same time or thinking about the next question to ask. A good listener will stop talking and use receptive language such as "I see . . . oh really." This will encourage the service provider or receptionist's train of thought. This also compels the interviewer to react to the ideas presented and ask additional questions, which will help gather critical information about the service provider or receptionist.
The final skill is to concentrate on what the service provider or receptionist is saying. This will allow the interviewer to fully hear the service provider or receptionist's point of view and process the information. It is critical to minimize the distractions during the interview. This includes turning off the Blackberry and/or cell phone, conducting the interview in a conducive work environment, and documenting the responses and comments received from the service provider or receptionist.
Once you have a trained the interviewer on listening and general interviewing techniques, the next step is to provide the tools to be an effective interviewer.
1. Prepare the interview team with service provider or receptionist information.
Service provider or receptionist's resume
Telephone screening notes from the recruiter
Position description
Interview questions for the position
These documents will help the interviewer prepare for the interview and be ready to listen to and engage the service provider or receptionist.
2. Provide interview forms to document the results of the interview.
The interviewer should utilize detailed questions to document the service provider or receptionist's answers during the interview. It is critical that the interviewer follow specific questions to maintain consistency with interviewing practices and for legal validation of hiring decisions. In addition to using the questions, interviewers should document the service provider or receptionist's answers. Ther will provide better comparison data for evaluating the best service provider or receptionist for a position.
Furthermore, provide an evaluation form for the interviewer to use to document the pros and cons of the service provider or receptionist, as well as to provide her recommendation whether to move the service provider or receptionist to the next step. The evaluation form will allow you to compare service provider or receptionists and weigh the positives against the negatives to determine fit for the role, as well as identify any training needs that should be addressed if the service provider or receptionist is hired.
The most important aspect of an interview is that the interviewer ascertains valuable information to determine if a service provider or receptionist is a proper fit for a position. There is a balancing act between assessing the skills of a service provider or receptionist, and selling the position and salon/spa to the service provider or receptionist. Selling the salon/spa to assess interest level as well as to excite the service provider or receptionist if he is considering other opportunities is critical to your success. However, don't sell too much. Be interested in learning about the service provider or receptionist's skills, knowledge, education, experience, and personal interests. Too often we, as interviewers, like the service provider or receptionist from the initial first impression and spend the rest of the interview selling, selling, and selling.
Effective listening skills will increase the quality of your new hires, improve training of new hires, and ultimately decrease your salon/spa's turnover rate. It is simple: make sure your interviewers are focused on actually interviewing the service provider or receptionist and not spending the entire time talking. The interviewers need to be interested, not interesting.
Tuesday, December 11, 2007
Looking toward 2008
As a vertical software house and Var for a point of sale vertical market (beauty salons and day spas) we have a very specific view of the computer and software industry. This coming year we are expecting more support and products for the retail point of sale industry especially for the small retailers – like our salon and spa customers. Fuel prices will continue to climb and small, local, convenient retailers will become more and more popular with consumers. We also feel there will continue to be more price pressure on the mass computer mail order and retail channels with some fallout. The cheap white boxes have less and less options required to support all the peripherals that are needed for POS. Our software can be bundled with the (can I say this?) HP Retail Solution that is a turnkey retail computer with all the peripherals. It is a great solution with on-site service for the small retailer included and it is all HP. The bundle is an easy sell and support is a breeze. The other area of growth is partnering with other software companies that offer complementary products for our retail POS clients. The credit card processing, automatic e-mail marketing, automatic off site backup services, and direct mail marketing services are inexpensive and allow our POS system to handle many marketing and administrative tasks automatically and unattended! The tasks are programmed to happen over night using the internet for sending files and processing information. Our clients love it.
Thursday, May 03, 2007
How to Double your Customer Average Ticket
A FEW SERVICE MENU IDEAS
-or-
How to Double the Average Customer Ticket
In traveling all over the country working with salons and spa I get to see all types of service menus. It is amazing the impact of a good service menu can have on your salon or spa. Now I am sure you have a service menu with nice graphics and a great layout. Those areas are a given in most salons and spas these days. But the difference between a nice (good) service menu and a GREAT service menu is how much the service menu $ells for you!
Let me give you an example of this idea in the restaurant industry. David Frey tells the following story:
" In my local town (Friendswood, TX) there is a privately owned sandwich shop that prides itself in offering more sandwich variations than any of the fast food restaurants in town. The owner is a friend of mine and he was mentioning to me the other day about how slow his sales were. Knowing that I was a marketer he asked me if I had any suggestions. I Asked My Friend to
Show Me His Menu...
I looked at the menu and immediately spotted a major problem. I told him, "How would you like to increase your sales by 30% with the exact same amount of customers that currently come through your shop?" His eyebrows rose with interest. I mentioned to him that he was making the same mistake that many business owners make in not only the food industry but in most industries. He said, "I'm listening David."Now I had his attention. (And I hope I have yours too.)
What I Told My Friend to Do...As I looked at my friends menu it was packed with different types of sandwiches with all kinds of sidedishes and about 12 different drink options. There were a lot of options. In fact, there were too many options. I told my friend to do 4 things...
1. Remove 30% of the sandwich and drink offerings on his menu.
2. Create 5 different bundled "value offers" such as a drink, sandwich, chips, and a cookie. Then increase the price by 30%.
3. Put a big red starburst on the menu next to two of the sandwich bundles. The first one should say"Voted # 1 in Flavor by Our Customers" (highest price) and the second one should say
"Today's Special" (lowest bundle price).
4. Stock up on the ingredients for the two value bundles that had the red starbursts next to them anddecrease the stock of the other sandwiches.He was courageous enough to test my recommendations and low and behold, the average transaction value of his sales increased by around 20% (Not the 30% that I had hoped for but close.)"
David is a marketing consultant who works with many different types of companies. We can use his idea in our salons and spas. Read his book "Best Marketing Practices" for more ideas.
The idea presented to the restaurant owner can be modified slightly to work with our salons and spas. It is critical that we simplify our message to our customers and make it easy to do business with us. It is also important to make the services we offer easy to communicate for our front desk and easy to sell for our service providers.
Using these ideas and rules for menu and service development could double your average sales ticket without adding one new customer. That brings up another important fact:
With the number of customers shrinking in a slower economy and the competition increasing for those customers it is important to have the customer getting every possible service from us.
It will increase our retention and increase our sales dollars!
A smart marketer once said, "Confused Minds Always Say NO!" It's true, when you provide too many options to a customer then they get confused and often decide not to buy anything at all. This marketing principle plays out in many different ways. Read the following examples of how you can implement this important marketing principle:
Example 1 - When asking for referrals, instead of saying, "Do you know anyone
who would benefit from my services?" you say, "Is there someone you work with who might enjoy our services?
Example 2 - When selling multiple items, whether on your website or in your ads, or sales posters at your salon/spa always position your best products as "Top Seller" or
"Todays Special" or "Best Value."
Example 3 - When advertising retail items only focus on one or two offers or one offer per category. Have a product of the month. Get your distributor to help with a discount you can pass on and free samples to give out. Get free backbar products to use to promote the product of the month.
Example 4 - When in a face-to-face selling situation, find out your customer’s needs and offer only one, or at most, two solutions. Give the customer two options to choose between.
Example 5 - When creating different price points for different packages of goods make one price an obvious choice. Put together a spa sampler for $99. Don’t allow swapping of services in the package.
You see, the idea is not to make anyone think about your offer. If they have to think too much about your offer you're one step away from losing the sale.Get back to your core services. If you have not done a hydrotherapy massage in 4 months get it off your menu. Delete it from your product classes. Take it out of your service inventory! If you direct your staff to concentrate on your core services and script them on selling, supporting and providing those core services you will be more successful.
Promote the things that make your core services unique. You always provide the service with a consultation. You run on time. You have special training in these areas. You have a great track record in the core service area with referrals, awards, and recognition.
Let’s take a haircut for example.
Many salons derive 40% of sales from cutting hair. How can you make your haircut unique? You offer a scalp massage with the precut shampoo. You have a quick conditioner that helps with your cutting technique.
Trademark your core service or name your core service to differentiate it. Your haircuts could be called precision cuts, the perfect haircut, custom cut, or whatever you think matches your core service. You use razor, clippers, or shears based on the look you want to achieve. You always style the hair so no customer leaves without a great look (and an advertisement of your work). You always do a consultation with the cut. You always prescribe the products to maintain the style and show the customer how to use them. You offer to do a free style training if they get home and can’t achieve the style. You always offer a survey card after the service and give a follow up thank you call or mailing.
When you have your core services look at add on services you can bundle with your core items to create a higher average ticket. Upgrade the quick conditioner to a deep conditioner for just $6 more. Add the paraffin treatment to the manicure for only $12. Do a nail art item with every manicure for a special price. Upgrade to a french manicure with hand massage for only $12 more. Combine a mini facial with your massage for just $30 and it only takes an extra 15 minutes. The options and opportunities are endless. They just need to be easy, uncomplicated, and provide a true value for the extra few dollars.
You can use our Preceptionist Upsell program to do the add on and upsell items at the time of the appointment and really make the whole system work! See our Preceptionist information at under presentations and articles.
You can offer the special packages of services and product of the month deals at the customer checkout and sell them on the deal for their next visit. Note: it’s even better to sell them on the add ons and product of the month during the pre-service consultation. Most customers want to rush out the door as soon as their service is completed. It is hard to keep their attention during the customer check out. Try moving the up sell and add on script to the preservice consultation period and watch your average ticket grow!
Call us for more marketing ideas at 513-528-5100 or check out our web site at
Fred Dengler
The MIKAL Corporation
-or-
How to Double the Average Customer Ticket
In traveling all over the country working with salons and spa I get to see all types of service menus. It is amazing the impact of a good service menu can have on your salon or spa. Now I am sure you have a service menu with nice graphics and a great layout. Those areas are a given in most salons and spas these days. But the difference between a nice (good) service menu and a GREAT service menu is how much the service menu $ells for you!
Let me give you an example of this idea in the restaurant industry. David Frey tells the following story:
" In my local town (Friendswood, TX) there is a privately owned sandwich shop that prides itself in offering more sandwich variations than any of the fast food restaurants in town. The owner is a friend of mine and he was mentioning to me the other day about how slow his sales were. Knowing that I was a marketer he asked me if I had any suggestions. I Asked My Friend to
Show Me His Menu...
I looked at the menu and immediately spotted a major problem. I told him, "How would you like to increase your sales by 30% with the exact same amount of customers that currently come through your shop?" His eyebrows rose with interest. I mentioned to him that he was making the same mistake that many business owners make in not only the food industry but in most industries. He said, "I'm listening David."Now I had his attention. (And I hope I have yours too.)
What I Told My Friend to Do...As I looked at my friends menu it was packed with different types of sandwiches with all kinds of sidedishes and about 12 different drink options. There were a lot of options. In fact, there were too many options. I told my friend to do 4 things...
1. Remove 30% of the sandwich and drink offerings on his menu.
2. Create 5 different bundled "value offers" such as a drink, sandwich, chips, and a cookie. Then increase the price by 30%.
3. Put a big red starburst on the menu next to two of the sandwich bundles. The first one should say"Voted # 1 in Flavor by Our Customers" (highest price) and the second one should say
"Today's Special" (lowest bundle price).
4. Stock up on the ingredients for the two value bundles that had the red starbursts next to them anddecrease the stock of the other sandwiches.He was courageous enough to test my recommendations and low and behold, the average transaction value of his sales increased by around 20% (Not the 30% that I had hoped for but close.)"
David is a marketing consultant who works with many different types of companies. We can use his idea in our salons and spas. Read his book "Best Marketing Practices" for more ideas.
The idea presented to the restaurant owner can be modified slightly to work with our salons and spas. It is critical that we simplify our message to our customers and make it easy to do business with us. It is also important to make the services we offer easy to communicate for our front desk and easy to sell for our service providers.
Using these ideas and rules for menu and service development could double your average sales ticket without adding one new customer. That brings up another important fact:
With the number of customers shrinking in a slower economy and the competition increasing for those customers it is important to have the customer getting every possible service from us.
It will increase our retention and increase our sales dollars!
A smart marketer once said, "Confused Minds Always Say NO!" It's true, when you provide too many options to a customer then they get confused and often decide not to buy anything at all. This marketing principle plays out in many different ways. Read the following examples of how you can implement this important marketing principle:
Example 1 - When asking for referrals, instead of saying, "Do you know anyone
who would benefit from my services?" you say, "Is there someone you work with who might enjoy our services?
Example 2 - When selling multiple items, whether on your website or in your ads, or sales posters at your salon/spa always position your best products as "Top Seller" or
"Todays Special" or "Best Value."
Example 3 - When advertising retail items only focus on one or two offers or one offer per category. Have a product of the month. Get your distributor to help with a discount you can pass on and free samples to give out. Get free backbar products to use to promote the product of the month.
Example 4 - When in a face-to-face selling situation, find out your customer’s needs and offer only one, or at most, two solutions. Give the customer two options to choose between.
Example 5 - When creating different price points for different packages of goods make one price an obvious choice. Put together a spa sampler for $99. Don’t allow swapping of services in the package.
You see, the idea is not to make anyone think about your offer. If they have to think too much about your offer you're one step away from losing the sale.Get back to your core services. If you have not done a hydrotherapy massage in 4 months get it off your menu. Delete it from your product classes. Take it out of your service inventory! If you direct your staff to concentrate on your core services and script them on selling, supporting and providing those core services you will be more successful.
Promote the things that make your core services unique. You always provide the service with a consultation. You run on time. You have special training in these areas. You have a great track record in the core service area with referrals, awards, and recognition.
Let’s take a haircut for example.
Many salons derive 40% of sales from cutting hair. How can you make your haircut unique? You offer a scalp massage with the precut shampoo. You have a quick conditioner that helps with your cutting technique.
Trademark your core service or name your core service to differentiate it. Your haircuts could be called precision cuts, the perfect haircut, custom cut, or whatever you think matches your core service. You use razor, clippers, or shears based on the look you want to achieve. You always style the hair so no customer leaves without a great look (and an advertisement of your work). You always do a consultation with the cut. You always prescribe the products to maintain the style and show the customer how to use them. You offer to do a free style training if they get home and can’t achieve the style. You always offer a survey card after the service and give a follow up thank you call or mailing.
When you have your core services look at add on services you can bundle with your core items to create a higher average ticket. Upgrade the quick conditioner to a deep conditioner for just $6 more. Add the paraffin treatment to the manicure for only $12. Do a nail art item with every manicure for a special price. Upgrade to a french manicure with hand massage for only $12 more. Combine a mini facial with your massage for just $30 and it only takes an extra 15 minutes. The options and opportunities are endless. They just need to be easy, uncomplicated, and provide a true value for the extra few dollars.
You can use our Preceptionist Upsell program to do the add on and upsell items at the time of the appointment and really make the whole system work! See our Preceptionist information at under presentations and articles.
You can offer the special packages of services and product of the month deals at the customer checkout and sell them on the deal for their next visit. Note: it’s even better to sell them on the add ons and product of the month during the pre-service consultation. Most customers want to rush out the door as soon as their service is completed. It is hard to keep their attention during the customer check out. Try moving the up sell and add on script to the preservice consultation period and watch your average ticket grow!
Call us for more marketing ideas at 513-528-5100 or check out our web site at
Fred Dengler
The MIKAL Corporation
Is your Salon Rent too high?
ARE YOU PAYING TOO MUCH RENT?
If you were negotiating a lease today how much would you be willing to pay?
The average independent salon pays 20% more in rent than a comparable chain salon. Your lease may have been signed a few years ago and many lease agreements include an annual increase in base rent. Even if your lease does not include increases you may be paying too much rent. Check your area yearly to find out the rates for which comparable facilities are available.
Your rent should not be more that 7% of your sales. If you have cheaper rent your marketing costs will be higher that 3% of sales. If your rent is greater than 7% your marketing expenses should be less.
Call us for more figures on costs of doing business at 513-528-5100.
When salons go out of business it is usually because expenses outnumber income. It is increasingly important to manage your expenses efficiently and one of our largest items is rent. You are not helpless to reduce this expense just because you have a lease. Property owners have seen the empty store fronts in strip centers, the many small salons going out of business and the decline of value in their own property. They know they are in a buyer's market. Property managers and landlords shop their market and know the value of space you are leasing. You owe it to yourself to do the same.
It's in your property manager's best interest for your business to thrive and holding down the amount you pay in rent will facilitate this. If you find that space in your area is going for less than the amount you are paying and many small businesses are failing, you are in a prime position to renegotiate your lease. As any business proposition, this should be approached in a professionally to be executed effectively.
Use this format as a guide in designing you letter. Get your lawyer and accountant involved in the financials and letter format if possible. If you don't get a response within 30 days send a second request and then call them.
See our marketing and management articles on our web site at .
Call us for more marketing and management ideas at 513-528-5100.
Sources of information RA Lipton-Beauty Store Business, Retail Association, The GreenBook
The MIKAL Corp
www.mikal.com
If you were negotiating a lease today how much would you be willing to pay?
The average independent salon pays 20% more in rent than a comparable chain salon. Your lease may have been signed a few years ago and many lease agreements include an annual increase in base rent. Even if your lease does not include increases you may be paying too much rent. Check your area yearly to find out the rates for which comparable facilities are available.
Your rent should not be more that 7% of your sales. If you have cheaper rent your marketing costs will be higher that 3% of sales. If your rent is greater than 7% your marketing expenses should be less.
Call us for more figures on costs of doing business at 513-528-5100.
When salons go out of business it is usually because expenses outnumber income. It is increasingly important to manage your expenses efficiently and one of our largest items is rent. You are not helpless to reduce this expense just because you have a lease. Property owners have seen the empty store fronts in strip centers, the many small salons going out of business and the decline of value in their own property. They know they are in a buyer's market. Property managers and landlords shop their market and know the value of space you are leasing. You owe it to yourself to do the same.
It's in your property manager's best interest for your business to thrive and holding down the amount you pay in rent will facilitate this. If you find that space in your area is going for less than the amount you are paying and many small businesses are failing, you are in a prime position to renegotiate your lease. As any business proposition, this should be approached in a professionally to be executed effectively.
Use this format as a guide in designing you letter. Get your lawyer and accountant involved in the financials and letter format if possible. If you don't get a response within 30 days send a second request and then call them.
See our marketing and management articles on our web site at .
Call us for more marketing and management ideas at 513-528-5100.
Sources of information RA Lipton-Beauty Store Business, Retail Association, The GreenBook
The MIKAL Corp
www.mikal.com
Wednesday, January 03, 2007
Retention is the key to salon/spa profits in 2007
Did you know that for every 5% you increase retention your bottom line increases 1%????
Retention is the key to profits for 2007!
If you can get your new customer retention up to 50% plus and rebook 2 out of every 3 customers before they leave you will be in the top 5% of the industry in retention and net profits. The key to making money is getting your present customers in more often and getting more of your first time customers in developing a habit of visiting your salon and spa.
What are you doing right now to make sure customers are rebooking?
Here is the strategy we came up with to increase Perfections retention and rebookings. Create a business size card with the offer of $10 off your next retail product purchase on your next visit and only give it to the customer if they prebook their next visit! Here is how the business card sized tool works: EVERY CUSTOMER that checks in gets this card when they check in at the front desk. This gives them time to read the card and experience the service and make a decision to rebook before leaving. When the customer checks out the receptionists or service provider asks if the customer wants to activate the card (not do you want to rebook the appointment). Supporting documents include a table talker (sign) at each station like the front of the card and the MIKAL receipt printing automatically with the marketing message and the next appointment date/time printing.
What makes this idea GREAT?
– The rebooking increase retention and profits
– The offer is for the NEXT visit
– The give away is Retail so the staff can’t complain
– The give away gets the customer to experience retail another great habit for the customer to develop
Want more Cash Flow ideas?
Check out Gary Ahlquist’s cash flow web site at http://www.saloncashflow.com/cmd.php?af=496738
Download our FREE Frequent Buyer Program at
http://24.123.10.107/wwwmikal/mailpdf.asp?code=m5
Download our FREE Mikal Marketing Calendar at
http://24.123.10.107/wwwmikal/mailpdf.asp?code=m7
Want even more business building ideas?
Check out all the information at www.mikal.com
Need Software that MAKES YOU MONEY instead of counting BEANS?
Call us at 800-448-5420 just spend 15 minutes looking at how our system
will make you money and we will give you a Salon/Spa Policy Manual on
CD worth $59 – what do you have to lose?
The MIKAL Corporation
www.mikal.com
sales@mikal.com
800-448-5420
Retention is the key to profits for 2007!
If you can get your new customer retention up to 50% plus and rebook 2 out of every 3 customers before they leave you will be in the top 5% of the industry in retention and net profits. The key to making money is getting your present customers in more often and getting more of your first time customers in developing a habit of visiting your salon and spa.
What are you doing right now to make sure customers are rebooking?
Here is the strategy we came up with to increase Perfections retention and rebookings. Create a business size card with the offer of $10 off your next retail product purchase on your next visit and only give it to the customer if they prebook their next visit! Here is how the business card sized tool works: EVERY CUSTOMER that checks in gets this card when they check in at the front desk. This gives them time to read the card and experience the service and make a decision to rebook before leaving. When the customer checks out the receptionists or service provider asks if the customer wants to activate the card (not do you want to rebook the appointment). Supporting documents include a table talker (sign) at each station like the front of the card and the MIKAL receipt printing automatically with the marketing message and the next appointment date/time printing.
What makes this idea GREAT?
– The rebooking increase retention and profits
– The offer is for the NEXT visit
– The give away is Retail so the staff can’t complain
– The give away gets the customer to experience retail another great habit for the customer to develop
Want more Cash Flow ideas?
Check out Gary Ahlquist’s cash flow web site at http://www.saloncashflow.com/cmd.php?af=496738
Download our FREE Frequent Buyer Program at
http://24.123.10.107/wwwmikal/mailpdf.asp?code=m5
Download our FREE Mikal Marketing Calendar at
http://24.123.10.107/wwwmikal/mailpdf.asp?code=m7
Want even more business building ideas?
Check out all the information at www.mikal.com
Need Software that MAKES YOU MONEY instead of counting BEANS?
Call us at 800-448-5420 just spend 15 minutes looking at how our system
will make you money and we will give you a Salon/Spa Policy Manual on
CD worth $59 – what do you have to lose?
The MIKAL Corporation
www.mikal.com
sales@mikal.com
800-448-5420
TIP reporting is a GREAT IDEA!
TIP reporting is a GREAT IDEA!
That's right. Tracking and reporting tips is a great idea compared to the alternative. Most salons and spas are not tracking tips and to "disrupt" the potential IRS audit trail are doing crazy things like not allowing tips on credit cards.
First this will not hinder the audit. The IRS will look at the credit card receipts and expect the staff and salon to withhold a percentage (about 8%) of service sales as tips - no argument allowed!
Second to not allow tips on credit cards reduces tips substantially. Everyone knows tips are higher on a credit card than on cash payments - many times TWICE as much.Let's do the math:As a stylist you only take cash. You have a $1000 service sales week and end up with an average of 8% tips. That means you make $80 in tips.Another stylist accepts credit cards and 80% of the payments are made with the card. The tips average 20% of service sales. That means the tips would be up to $200 on the same $1000 in service sales. If the IRS gets 30% of the money the stylist taking credit card tips still clears $140 instead of only $80 (that still needs the taxes taken out).
C: Maybe you think cash customers tip more than 8% - track it for a week and tell me I'm wrong. In fact in some salons that have gone to no tips on credit cards customers literally don't have the cash to give a tip - how much cash is in your wallet rignt now?
Do the math and think about it. Be IRS compliant and make more money or .........What do you think? Fred
-->
That's right. Tracking and reporting tips is a great idea compared to the alternative. Most salons and spas are not tracking tips and to "disrupt" the potential IRS audit trail are doing crazy things like not allowing tips on credit cards.
First this will not hinder the audit. The IRS will look at the credit card receipts and expect the staff and salon to withhold a percentage (about 8%) of service sales as tips - no argument allowed!
Second to not allow tips on credit cards reduces tips substantially. Everyone knows tips are higher on a credit card than on cash payments - many times TWICE as much.Let's do the math:As a stylist you only take cash. You have a $1000 service sales week and end up with an average of 8% tips. That means you make $80 in tips.Another stylist accepts credit cards and 80% of the payments are made with the card. The tips average 20% of service sales. That means the tips would be up to $200 on the same $1000 in service sales. If the IRS gets 30% of the money the stylist taking credit card tips still clears $140 instead of only $80 (that still needs the taxes taken out).
C: Maybe you think cash customers tip more than 8% - track it for a week and tell me I'm wrong. In fact in some salons that have gone to no tips on credit cards customers literally don't have the cash to give a tip - how much cash is in your wallet rignt now?
Do the math and think about it. Be IRS compliant and make more money or .........What do you think? Fred
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