Too Hot to Handle When Jenny opened her full-service salon and day spa three years ago, she knew that she would have to make some difficult choices regarding the hiring and firing of qualified professionals such as cosmetologists, estheticians, nail technicians, and massage therapists. However, she was confident that her salon management training at Palace Beauty College, coupled with her industry experience as a stylist, would serve her well And serve her well they certainly did! Within three years of starting her own business, and after a few setbacks, she had managed to assemble a team of 10 salon professionals, all extremely motivated, people-oriented, self-driven individuals who worked hard at retaining their clients and drumming up retail sales. Of course, Jenny had put in place an incentive plan, which the stylists found to be challenging, yet lucrative. Jenny's salon revenues had grown significantly each year to their current annual level of $500,000. On average, the salon serviced about 40 customers per day with an average ticket of $50 However, over the past year or so a number of new salons and nail spas had opened up in the city. Competition had become much more severe, and customers were being swayed by numerous discount coupons. Jenny was well aware that her current sales growth rate of 10% would not continue for very long. At the suggestion of some of her regular clients, she decided to explore the possibility of expanding her service offerings to include tanning booths. 48 Too Hot to Handle When Jenny opened her full-service salon and day spa three years ago, she knew that she would have to make some difficult choices regarding the hiring and firing of qualified professionals such as cosmetologists, estheticians, nail technicians, and massage therapists. However, she was confident that her salon management training at Palace Beauty College, coupled with her industry experience as a stylist, would serve her well And serve her well they certainly did! Within three years of starting her own business, and after a few setbacks, she had managed to assemble a team of 10 salon professionals, all extremely motivated, people-oriented, self-driven individuals who worked hard at retaining their clients and drumming up retail sales. Of course, Jenny had put in place an incentive plan, which the stylists found to be challenging, yet lucrative. Jenny's salon revenues had grown significantly each year to their current annual level of $500,000. On average, the salon serviced about 40 customers per day with an average ticket of $50 However, over the past year or so a number of new salons and nail spas had opened up in the city. Competition had become much more severe, and customers were being swayed by numerous discount coupons. Jenny was well aware that her current sales growth rate of 10% would not continue for very long. At the suggestion of some of her regular clients, she decided to explore the possibility of expanding her service offerings to include tanning booths. 48
