Ana's No Brainer #3: Productivity; Less Can Be More
December 6th, 2007 • Posted by Ana Loiselle-Donahue • Permalink
This topic got sparked a couple of weeks ago when I was driving in the car with my husband Larry, and his two girls, to take them for haircuts. I told Larry that we couldn’t go to the “usual” place because the person who answered the phone told me they were “booked up for the day.” Larry’s response to this was, “Good for them!”
Many of you may be thinking the same thing, BUT I am hear to tell you that such thinking slows the growth of your business; no if, ands, or buts about it!
As we drove to a new place to cut the girls’ hair, I launched into a 15 minute diatribe with Larry about how this view of productivity and client retention was skewed. It went something like this …
Retaining clients is paramount in growing your business, and productivity is certainly one of the most important measurements of team effectiveness for spas and salons. Studies prove that when productivity is higher than 80%, retention begins to suffer. As productivity initially increases, so does retention. But, when productivity rises above 80%, retention stalls and reverses direction. The result is short-term sales without long-term growth and profits.
Let’s look at the problem from the client’s perspective: Client access becomes restricted when technicians are “booked” at or near capacity because clients have a harder time getting a convenient time slot. So they go elsewhere, as in the case with Larry and his girls.
Is there an easy solution to this? Measurement of this phenomenon can be difficult, but here is some quick tips to ensure you are not turning clients away and stunting your company’s growth:
- Requests only – If you have technicians who receive a high percentage of requests, don’t book him/her with clients that do not request them. Fill the book of less productive technicians with these clients.
- Schedule the slow times first – If a client’s schedule is flexible, book the slow or hard-to-book times first, knowing the peak times will always fill.
- Gridlocked technicians – When a technician begins to get gridlocked or “booked up,” systems should be in place to orient these clients with other equally trained team members or it may be time to hire someone new to the team.
Remember: it’s expensive to get a client to walk through your door the first time; don’t screw it up by being “booked up” and forcing that client to go to one of your competitors. The choice is yours.
With almost 10 years experience in new business start-ups and transformations, Ana Loiselle-Donahue is a specialist in finding new sources of revenue and growth for companies of all sizes. She founded theSECRET in 2004 to help businesses flourish through creative —and powerful —new solutions; including brand development, strategic financial planning and employee training. Mrs. Loiselle-Donahue can be reached at 866/288-7353 or at www.thesecretconsultant.com. Check out her blog!
• Trackback • Posted in Spa Business Management, the SECRET
That's great advice for a place with multiple employees. Any advice for those of us who are a one (wo)man show?
Anna,
Great advice and I agree with it completely except that you are forgetting one important factor. What happens when all of the available technicians are completely booked and there is no one available to hire? We have 27 employees yet only a few demonstrate a true desire to work. We are hard-pressed to simply fire the slackers (even with multiple infractions) because there is no one to replace them with (and they know it). It's not like we don't pay a lot, our average esthetician makes over $50k per year working 4 days per week. I have placed help wanted ads all over the world but have been unable to find qualified technicians that want to come make a career in Pittsburgh. So if the idea of just "hire someone new to the team" doesn't apply, then what?
Best,
Eva
http://www.esspa.com
Anna is so right on!
Dear Eva, I hear this complaint often that there is simply no one to hire. Indeed recruiting good employees is hard, but that is what ownership and management are all about. The staff you need is out there and no matter how hard or how creative you need to be YOUR job is to find them.
Recruitment is a science that takes professionals who are up to the task to acheive success, "I can't do it" or "there is no one out there" is the cry of someone who already given up after only trying the easy things.
or so it seems ot me…
Anyway, Anna great blog!!
Best Wishes & Healthy Profits
Skip Williams
So true. This information really is a jewel.
Great blog Anna!
I think there is some very solid advice here, although through my experience with operations, I came to the conclusion that it was great for the business to introduce at least some new clients to the best therapists on staff (those most in demand).
This way new clients are introduced to your business in the best possible way, and are more likely to come back to try other treatments or buy your gift certificates. That being said, I would suggest leaving a few openings in the schedules of your most popular therapist just for new clients.
To address Eva's point: in keeping the slackers on, the plan always backfires. When I participate in educational seminars, I teach owners to get rid of these repeat offenders instead of being a hostage to bad employees. The damage they do to your business is more severe than having a higher demand than availability. Their attitude spreads like wildfire and they are not shy with sharing their feelings with clients. Certainly a lose-lose all around.
My advice: Hire new people right out of local aesthetic schools (ask the teachers for the most talented ones in their class) and invest money and energy in training them.
Much success!
Milana Knowles
Hi Skip,
Not to beat a dead horse but I defy you (or anyone) to come to Pittsburgh and find 27 well-qualified people to staff a 7-day spa-only operation.
Love,
Eva
Glad all that have responded have enjoyed my article!! I wanted to expound on my article a bit to address some of the questions. Before I start, I wanted to acknowledge that this topic (like many I bring up in the no-brainers), are complex and difficult to cover in a few paragraphs on the blog. I will do my best!
Sequestering
To address: “I came to the conclusion that it was great for the business to introduce at least some new clients to the best therapists on staff (those most in demand).” I think this is great however, it holds a few challenges if not all areas are addressed.
Lets suppose you have a situation where you’re getting many new clients and the tech best able to retain them is your gridlocked (booked up) tech. If you feel confident that you can EFFECTIVELY move his/ her clients to other less productive techs and RETAIN them, you may want to sequester (hold) the gridlocked tech’s time. However, just sequestering “those most in demand’s” time or just giving them new clients will only lead to one problem; if you don’t have other qualified staff to take on their already happy clients – A LOSS IN RETENTION. In other words the single, biggest reason why people change salons or spas, is because they can’t get and appointment with “their” technician.
So, if you introduce new clients to your “best” techs, remember systems should be in place to orient their existing clients with other equally trained team members.
No Good Help – Help!
You don’t know how many times I hear this (oh, okay, I use to say this when I owned my salon and spa, until I learned better …
) I can tell you from experience that if you are looking for qualified techs from the get-go, it’s not going to happen. A training program has to be in place. Here’s why: Training aids in the recruiting process. If you're committed to training, you'll be more apt to hire a WILLING candidate who lacks a specific skill (get them right out of school). Training also makes your company more attractive in the eyes of potential employees, because it shows them they have room to grow and accept new challenges. In addition, training existing employees could reduce the need to hire new staff. To learn more, check out an article I wrote, entitled The Benefits of Skilled-Based Training on my website.
Protecting the company’s profits by making sure the company isn’t under staff and over booked is crucial to your success.
Ana, I could not agree more on the issue of moving the overflow clients to less booked techs.
The plot thickens only if the less booked providers are those "slackers" that are never happy and shy away from good work. These employees shouldn’t be rewarded just because they are available and have little requests. To be able to refer the overflow to other equally trained team members is not only desirable but should be required. Passing on request clients to another service provider is not as easy as it sounds as people do not like change. The secret to introducing any new idea or program is to show your employee the impact that the program is going to have on their bottom line.
Hint: First look at this idea’s impact on your bottom line and if your results are good, it will eventually affect positively all employees. Once you have done the math yourself, it will be easer to “sell” the concept to your employees that might have questions. Numbers are the best success indicators.
Great training is the key, I agree.
Hiring talent out of schools and offering weekly in-house educational programs were essential to the success of the multiple spas locations I had managed, prior to becoming a VP of Day Spa Sales and Marketing at SpaFinder. I also ran one of the largest spas in New York, Avon Salon and Spa. At Avon, I had a staff of over 170 employees, and found it most challenging to find dedicated and talented service providers. Once you have a good team, the key is rewarding the great performers and establishing consequences for those who aren’t up to par.
Hi, all! The latest issue of Skin, Inc. has a solid article on recruiting and retaining Gen Xers. As a member of this generation, I thought it was right on in terms of what workers my age are looking for from their employers. I'm sure there are other like-minded people out there in cities across American more than willing to work for an employer who appreciates and respects what they have to contribute.
Actually, Eva, you might try recruiting spa professionals with their own shops who cast out on their own because they were frustrated with how past employers have treated them. I hear a lot of frustrations from other spa professionals in Denver about how they are treated, especially at the "top spas" in town. Best of luck!
~Christy
Hey Eva,
We do recruitment for Spas all over the country and understand the difficulties in finding qualified staff in a market that is short 27,000 providers (I think that is the number I heard at ISPA). The good news for you is that with the economic down turn in our industry, you will find that as shops close many Providers will be on the street looking for employment soon.
Eva, we use an interview process that makes it even more difficult to qualify them because we want to make sure they are an excellent fit for the owners. Therefore we interview about 10 candidates for every person hired.
I am not saying it is easy, but it can be done and we do this for our clients nationwide. In fact, as you may know, when we open spas they are usually employees paid by the hour instead of commission based, which is even a harder recruitment.
Bottom line is we have difficulty also, but then again our job is not done until we find the staff needed, so we do whatever it takes to find the staff we are looking for that gives our clients the greatest chance of future success.
Is every employee a home run? No, but we have a pretty good batting average finding staff that is less likely to turn over, and staff that are very willing to be trained. And Anna is right on when she says that training is the key.
Don't forget also that retention is as important as recruitment and training is a huge part of retention as are fairness, advancement, responsibility, and being part of something larger than themselves.
Best Wishes & Healthy Profits
Skip
When I began to read Ana's posting I was looking at the idea of work less earn more theory that I thought was going to be brought about with the idea of retention and profitability. For some odd reason I was waiting for the other shoe to drop indicating that sometimes grid lock happens with clients that may not be the most beneficial use of your time. I will hold back in giving a detailed explanation of that theory and focus for a moment on retention for a moment.
I recall sitting in an ISPA Networking seminar where we were discussing issues that needed to be brought to the table, that were a priority that could not be dismissed. I stood up and said client retention. I explained that I saw frequency of visits declining in my own business (19 years I have owned my spa). I shared my concern for many reasons and just recently if anyone has received the Industry Figures from ISPA, the overall client retention has dropped dramatically. I have to add that no one wanted to discuss that venue, it was interesting how quickly it was dismissed and now after the fact it is the main focus of many educational forums.
As for recruiting and training, the path that Ana's blog lead us down, here is just some food for thought. When technicians, service providers and therapist can step outside of their ego and work together we will then have a solution to the situations you have all posed above.
Don't forget, this profession is like many others… you need to educate, provide training programs, and require advanced & continuous education and pay should be compensation that is in line with the investment into the staff member’s education and experience. Maybe another view to be considered is that if we look at the cost of college and that investment and then the first year salary of that graduate and now take a glimpse at our industry and look at the investment that is made in cosmetology, massage, esthetic, and nail school… what is truly realistic to be paid for the positions you have in your business?
Yes, people are out there to hire, you need to be creative and our industry has to raise the bar. Ana thank you for your insight. Great to read something that is thought provoking and that took me down a path not expected.