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Maximizing Retailing |
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Maximizing Retailing |
Who’s that “Model Employee” that is a good return on your investment, never late or absent, working all the time and never talks back? Right, it’s your retail product - the silent salon profit maker that also helps to build salon loyalty!
Salon clients properly educated in a product’s use will drive out of their way to replenish it. At least it was that way until approximately three years ago when our industry saw diversion explode out of control. Today client’s only have to drive to their local supermarket or drugstore to purchase a lot of Professional Only products. However, rather than dwell on the challenges of diversion over licensed salon distribution let’s focus on the positive opportunities available with in-salon retailing.
“Maximize” means to increase or enhance to the utmost. Maximizing retailing begins with one key ingredient “P.R.A”, Positive Retail Attitude, knowing that you are helping your client style their hair faster, better, etc. not just to sell a product! Most stylists say they aren’t salespeople, you don’t have to be, just talk about what you are using to achieve the client’s style. Recommending retail is as easy as up selling salon services as long as your PRA is focused on the client, if they have faith in you the sale is automatic.
You want to emulate top retail players, take control of your inventory. This means buying right (promotion as well as quantities), stocking a sufficient amount of product and tracking sales. One common mistake with inventory that is made is for example, if you know you have the capabilities to sell 12 of DB Straight Conditioning Serum 25 in a week don’t just stock just three on your shelves and possibly lose sales.
At Dennis Bernard International (DBI), one of our most successful promotions was to have a salon purchase one bottle of TCA, The Color Accelerator at regular price and get 5, yes 5 of our top selling salon products free! Smart stylists and salon owners purchased multiple boxes so they would have enough for their back bar and their retail shelves. By the time they sold the products they had a 330% return on their investment not to mention what they make from the TCA! It’s a proven fact the more product in stock, the more it sells, just ask Wal-Mart!
Smart salons that buy retail on promotions pass the cost savings or a portion of it on to their clients. This is good business sense and having salon specials let your clients know that you are in the retail game for real and it stimulates impulse buys.
Some other strategies for maximizing retail would be packaging products together and offering a discount for their purchase. Outside packaging vendors such as Action Bag are great resources for innovative bags and tags. Inexpensive educational sheets for clients can be customized to your salon using a computer using the information supplied by the manufacturers own sell sheets. (This is of course assuming you had a salon meeting to train your staff on the new products.)
In some cases to get a new product off the launch pad in the salon it pays to offer stylists extra incentives. It could be dinner at their favorite restaurant, a gift card or the always acceptable cash! An extra dollar or two per bottle on top of the stylist’s regular product commission works like a charm!
Can we talk profits? Right now in the United States the average net profits on service sales runs 5 to 7 percent. Retail products average 40 to 60 percent and sometimes more! With percentages like that it’s amazing how few salons have a cohesive retail program in place. DBI will have a seminar on maximizing retailing profits starting in 2007 for independent salon owners and stylists.
Let’s recap on how to keep that “Model Employee” working for us-
Keep a PRA - Positive Retail Attitude
Buy right, from a diversion-free company such as DBI
Keep a sufficient quantity in inventory
Use the product at your stations and back bar
Educate the client using what ever tools that works for you i.e. Sell Sheets, DVD’s, etc.
Have specials passing savings you received on to your clients
Put together customized packages of retail product to fill your clients needs
Give your staff a fair product commission and to turbo-charge a targeted product sales offer an extra incentive to your stylists
These 8 keys are the essence to maximizing retail sales and profits. Every business dreams of the “Model Employee”, we are fortunate for in the beauty industry we have it - RETAIL!
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