Salon & Spa Industry An Introduction Florida State University Tues 7 Oct 2014 Martin Edwards | Director of Marketing Presentation Overview o Industry & Demographics o Business Type and Models o The “Average” Salon o Measurements for Success o Customer and Behavior o An Introduction to SalonBiz o Questions Industry, Market & Opportunity o 80,000 establishments in the US (76,000 hair/beauty; 4,000 barber shops) o Combined annual revenue of approx. $20 billion* o Industry CAGR projected at 3.4% thru 2018** o US industry highly fragmented: the 50 largest companies generate about 15 percent of overall revenue o California has more salons than any other state, followed by Florida, Texas, New York and Illinois* o In 2012, 35% of US salons featured some form of a booth rental model, with studies suggesting that this will exceed 50% of salons by 2015* Source : *PBA Annual Study 2014 **Lucintel Research Types of Business o Hair Salon o Salon & Spa o Spa (Stand alone or Hotel/Resort) o Booth/ Suite rental o Mobile A Typical Salon o An average salon employs 8 people, 2 of which are support staff o Generally owner operator managed o Across all professional beauty businesses, the majority (34.1% for the industry on average) are in the $100k to $250k range for total revenues (retail plus service sales) with the average being just over $250k. o Typically, around 68% of revenues come from hair services and 11% from retail o Profit margins average at 10.7% nationally. o The average client spends about $67.17 per visit on services and will visit on average 8-12 times per year. For retail purchases, the average is $20.55 per visit Measurements for Success o Monitoring and coaching the team is key to ensuring overall success o Keeping the largest single expense productive is essential Healthy 80% $65 70% 50% 30% 1500 $15 33% Expense Benchmarks o Controlling payroll expense is key o Supplier relations important o Minimize marketing spend o Software not a large expense Customer & Behavior What the Salon Would Like Customer’s Natural Behavior Pre-book next appointment Rush to leave and will call later to rebook Purchase recommended homecare products Will just wait and buy them next time, or pick something up in the grocery store Refer all their friends Keep their amazing stylist a secret all to themselves Use the services of the spa for nails, waxing or massage Go to their favorite place for each of these services separately What does SalonBiz Provide? Appointment Scheduling & CRM Reporting Point of Sale Marketing & Communications Inventory Control Unlimited Education & Technical Support Features Full Salon & Spa Management Software including Inventory, POS, Scheduling & CRM Powerful, flexible Custom Report Suite Mobile Access inc Booking for Owners, Managers & Service providers Consumer Online Booking & Gift Card Sales Features Tablet Tool – Rebook and recommend Product at the chair/spa room Central Dashboard – KPI’s displayed In an easy to digest format Performance Board – Break room display Integrated Credit card processing With Chase Paymentech Demandforce Integration Appointment confirmations by SMS & Email Email Marketing & Communication Collect and distribute reviews www.demandforce.com Why SalonBiz? Demandforce Cloud Based o Access from anywhere o Hardware agnostic o No backups required o No server costs Inventory Control o Track product usage to limit waste o Control par levels to manage stockholding o Save time when ordering o Save time on confirmation calls o Reduce no shows o Reach new guests o Gain Important feedback Tablet Tool Reporting o Recommend retail at the chair o Rebook from the chair o Update client details o Reduce bottle neck at the desk o Track performance o Identify opportunities o Save time on manual process SalonBiz Whiteboard o Transparent performance statistics o Ideal for in-the-moment coaching o Keep stylists away from the front desk o Removes need for extra lookup station Integrated Credit Cards SalonBiz Mobile o No terminal required ($$) o Better rates than many banks o Quicker checkout for client o Speeds up batching at end of day o Booking on the go o Keep an eye on key metrics o View client history to prepare for visit o Update important client notes Online Booking & Gift Cards o Stay open 24/7 o Generate additional revenue around holidays o Less phone calls to front desk Questions? www.salonbizsoftware.com martin.edwards@neilltech.com 985-507-6769 888-634-5570 x 2510