Paying Groomers – What is Fair?

November 16th, 2017 by Joelle

How and what professional groomers get paid is always a hot topic. There are so many variables:

  • Hourly?
  • Commission?
  • Pay rates?

MoneyOver the years I’ve tested just about every possible combination of scenarios to try to determine what was fair, what worked, and what didn’t.

When I started my first business, I groomed in the vans right beside my mobile groomers. My team earned 50% commission of the grooming charges. We also had an extra “house call charge” for the front door service per stop (not per dog).

My mobile fleet grew from one van to six in about five years. Plus, I added a grooming salon to the mix. We were busy all the time. However, every once in a while, cash got tight.

Have you ever been there?

As we grew, the cash flow would have high and low swings. When the swing went up, it was fun, and I could reinvest in the company. I would buy another van and pay for continuing education for both myself and my team. We celebrated when we met sales quotas.

Occasionally, I would struggle to make a payment. If catching up got too deep and available cash got tight, I would grab a credit card. In those moments, I needed to keep the vans on the road and take care of expenses no matter how high the interest rates.

The busier we got, the less I paid attention to the finances. After all, we were all working and bringing in money. It was inconceivable to think we wouldn’t have enough money to pay the bills or commission.

Quote In A CircleBut then it happened.

A payroll check bounced. The lights got turned off. The phone service got shut off.

Each of these stressful, embarrassing, and terrifying moments are the hard lessons many business owners face.

Early in my career, I didn’t pay attention to the financial health of my business. It was a painful lesson I needed to learn the hard way. I was losing sleep over it and after more than one negative incident, I vowed never to let it happen again.

Detailed bookkeeping wasn’t my forte – I would rather have been grooming. However, I bit the bullet and invested in a bookkeeper. She was much wiser than I when it came to money matters. She made sense of the income and the expenses and I started paying attention to my cash flow.

We worked closely together and each month she would create a profit and loss statement for me. It would contain all the standard categories along with monthly and year-to-date figures. Plus, she added a column that tracked the percentage of expenses to sales.

The percentages were critical. No matter how rapidly we grew, I started to see trends in the percentages. It allowed me to easily track the fiscal health of my companies at a glance.

Early in my first mobile business, the only thing really saving the company was the house call charge on top of the grooming fee. Little did I realize how detrimental a 50% commission rate was to the health of a business. It’s very hard to run a profitable company when you pay out almost half of your grooming revenue.

It’s even more challenging if you had W-2 employees vs. independent contractors (but that’s a whole ‘nother blog!). In the state of Michigan, an estimated 13% was paid in payroll tax obligations for my staff based on their wages.

Look at the chart below. If you are a commissioned groomer/stylist, find your rate. Next, find your average price per dog. For example, if you earn a 50% commission rate and the average ticket price of the dog is $50, you would be earning $25 per dog.

CHART_1

Did you find your place on the chart?

Notice what happens to the earning potential when pets are priced higher, yet the commission rate is lower?

Where would you rather work – at a salon with lower-priced dogs but at the 50% rate or at a higher priced salon with a lower commission?

The commission rate isn’t the true barometer of your earning potential. The price per dog combined with the commission rate is what you need to look at. Even if a commission rate is 38% but the average ticket price is $70, you would be earning $1.60 MORE than the 50% commission rate at $50 average grooming price.

Don’t get hung up on the commission rate. Pay attention to the average price per pet COMBINED with a commission rate. Then, do the math. It might surprise you!

In the next set of charts, I want to demonstrate what happens to a business paying out a 50% commission rate to employees. In these examples, I have simplified salon expenses. Most salons will have a longer list of expenses. The examples show how the numbers would play out over the course of a year. As you look through the amounts, notice what happens.

A

I have used a 50% commission rate for salon generating $150,000 per year.

 

B

The salon is generating $210,000 annually while paying out a commission of 50% to the groomers.

 

C

The salon is still generating $150,000 per year but now the commission rate has fallen to 44%.

 

D

The grooming commission rate is 44% but the average ticket price increased per dog, earning the salon $210,000 annually.

 

In example A, the salon is clearing $5,910 for the entire year or less than $500 each month.

If you are a salon owner, I’m guessing you did not get into business to run a nonprofit company. In this scenario, that’s pretty much what’s happening.  Remember, I simplified the outgoing costs of the businesses. Most salons will have more bills to pay than reflected in this example.

If you are an employee working at a salon paying 50%, you feel it every day. The lack of cash flow filters through. Chances are, the salon struggles to make ends meet. It has to cut corners. One financial hiccup can send it into a downward spiral.

The only way a 50% commission-based salon can truly make ends meet is if the salon owner is also one of the groomers. Another option is to have other streams of income other than just grooming.

Raising prices and dropping the commission rates is in the best interest of a business. It creates a cash flow buffer which takes the pressure off everything and everyone. It allows the business to thrive instead of struggle. It allows for higher-quality products, equipment, and education. These items make the workspace more enjoyable while minimizing burnout and maximizing quality.

Most salon owners and their employees are among the most passionate people I know. We’re hard workers and love pets. Owners and staff need to work together as a team. Everyone needs to understand what the numbers look like in order to have an enjoyable work environment.

My professional grooming department at Whiskers Resort & Pet Spa currently runs with a team of seven stylists and three grooming assistants. The team has both full- and part-time employees. The sliding-scale commission rates range from 38% – 44% for full grooms based on client satisfaction, rebooking, and financial quotas. Stylists earn lower commissions on simple bath and brush pets requiring less time. Stylists can bounce up and down the tier system based on the previous quarter’s performance. Grooming assistants are paid hourly based on experience and performance. On average, the grooming department’s commission payroll runs between 36% and 43% of gross sales. With lower commission rates, we can afford to pay the assistants and a portion of the customer service team who books all the grooming appointments.

Even with lower commissions, the average ticket price runs between $65 and $70 per dog. Based on personal motivation and experience, stylists groom an average six to 12 dogs a day. As a bonus, on a typical day, a stylist can also earn anywhere from $30 – $80 in tips on top of their commission rates. This department is flourishing, and the turnover is extremely low.

Salon owners, if you don’t have a firm handle on how the dollars stack up, I encourage you to track them and pay attention. If you don’t want to deal with it yourself (like me!), hire a bookkeeper. Then work closely with them and learn. They love to tinker with numbers the same way we like to tinker with dogs!

I encourage you to compare the charts. Check out the numbers. Think about how you fit within these examples. Then run your OWN numbers and see how you stack up. It does not matter whether you are the salon owner or a commissioned stylist. The numbers don’t lie and are the key to EVERYONE’S financial health and success.

Happy trimming!

Melissa

MVpaw_no_Inner_white

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What’s the Hardest Part of Running a Business?

August 3rd, 2017 by Joelle

06-27

In my experience, the hardest part of running a business is STAFF!

Hands down the most challenging part of running a business is staffing it. Managing staff. Keeping staff. Paying staff. Keeping them accountable. Keeping them productive. Keeping them happy.

And the real biggie – training them.

So let’s tackle the training challenge first. It’s far easier to hire basic labor than filling a position that requires skill. At our kennel, the Whiskers Resort and Pet Spa, we have an endless supply of dog enthusiasts that want to work in the kennel. With multiple colleges within our community, the labor force is easy to come by. After all, everybody wants to play with puppies!

But what about those jobs that require skilled labor? People like receptionists, bathers, managers, and trainers.

One of the largest reasons I started the Paragon School of Pet Grooming was because I could not find qualified groomers to operate my fleet of mobile grooming vans. They just weren’t available. I still shudder when I think about it. There were times that I would have a van down for 6 to 12 months at a time before I could find somebody that could do the job. Not a very efficient way to run a business.

Working every day in a mobile grooming salon does not lend itself well to a training environment. It can work if you just have to add polish to a skilled professional. But to take them from scratch? Nope. It doesn’t work. You just can’t afford the time it takes to train a new groomer – especially if you rely on YOUR productivity to pay the bills. Starting a person from scratch to become a competent groomer in a mobile just does not work!

To get a groomer that can work independently – with safety and quality – will take months, not weeks, to train. After all, this is not a skill that you can quickly show somebody how to do. Grooming is not a simple task. It requires significant training.

I’ve heard some businesses offer two-week training programs for new hires. Then they turn them loose to groom “professionally.” Some circles might consider this enough, but for quality and safety, you need more.

Did you know the average person needs to see or hear something 3 to 7 times before it actually sinks in? And that’s for an average learner. Sure, star performers might pick it up after the first or second try – but those people are few and far between. Most of us fall in the average category. We have to see or do the same task repeatedly before we do it correctly.

TrainingI’ve been in the pet care industry for over 30 years – primarily in the grooming aspect of the industry. Finding qualified groomers remains the number one problem in our field.

Finding talented grooming help was close to impossible was when I first stepped up to the grooming table in 1979 – and it remains the same problem today. I have chosen to focus on this critical problem. I own multiple companies in the pet industry. On the educational side, my companies aid in training and personal development for those stepping into the field for the first time as well as for aspiring pet groomers and stylists.

It has always been extremely easy to enter the field of pet grooming. There are very few regulations of any sort. Anybody can start bathing and cutting hair off a dog or cat, and call themselves a professional pet groomer. Those of us that have spent years perfecting our craft know it takes time and dedication to become confident and competent in all breed grooming. It takes years of practice and study.

Some of the ways that I have found to become a real professional include:

  • Studying the AKC Complete Dog Book or your national all breed book
  • Reading books produced by breed and/or industry specialists
  • Attending workshops and clinics hosted by industry leaders
  • Attending a grooming school – many have multiple programs from which to choose
  • Taking an online course from a reputable institution
  • Attending continued education training at qualified grooming schools
  • Watching videos produced by leading pet professionals

Even graduates coming out of quality grooming schools are not truly proficient. If they have graduated with above average GPA’s, they have given themselves a great foundation. It is the starting point of their career – but they are far from being a polished professional. They still need guidance. They still need coaching. They still need mentoring. They still need to study. And most of all – they need to practice A LOT!

featured-classified-300x232So let’s get back to that hiring challenge. If you’re faced with having to hire a groomer, know what to look for. One thing I recommend is Attitude. Attitude. Attitude. I always look for somebody who’s got a positive, upbeat attitude. Someone who is receptive to new information. They need to be moldable. Adaptable. And they cannot be afraid of hard work. I hire on potential, not necessarily experience.

Once you have someone with a great attitude, helping them be best they can be is fun – and it can be very gratifying. Use the resources available to help them self-direct their own learning.  It will take time, dedication, and patience before you see your new hire flourish but you can lighten your training load by taking advantage of many educational resources currently available. You might learn a thing or two yourself.

It amazes me that our industry has not advanced more in this area. Sure, there are more grooming schools than ever was before. Yes, there are certification organizations out there – but they’re still voluntary. Licensing, in some states is starting to catch on. However, we’re still a long way from having even a basic comprehensive licensing program in place for pet groomers and salon owners. The road before us is wide open with possibilities.

Will you help us blaze the trail?

Happy trimming!

Melissa

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What Type of Grooming Do You Do?

May 11th, 2017 by Joelle

Quote ThisMy educational team recently visited a local grooming salon. When they came back, they shared a comment made by the staff of the salon.

“We don’t do show grooms, it’s not what our customers want.”

I thought to myself, “Okay, but I don’t do ‘show grooms,’ either.” I never have. Nor do I teach show grooming. Very few of my products showcase show grooming – not the books, the Distance Learning Program, The Salon Mentoring Program, or the on-site programs taught at the Paragon School of Pet Grooming. None of them focus on show grooming. 90% of the videos from Learn2GroomDogs.com showcases every day grooming jobs – from shave downs to highly stylized pet trims.

…But the comment got me thinking. What determines the type of grooming we do? It boils down to one thing: the needs and demands of our clients.

Our clients will either make us strive to new heights or allow us to settle into a less demanding routine. I see this play out clearly between two of my companies.

When I started the Paragon School of Pet Grooming in the early 90’s, the Jenison community was a perfect fit for a school. At the time, I was running a fleet of six mobile vans. We catered to the upper echelon of the community. Our prices were higher than average salon prices for the premium front door service. That clientele appreciated and was willing to pay for this type of service.

Pet GroomThe Jenison market was on the outer edge of our service area. Occasionally, we would dip our toes into that market. We quickly learned that the Jenison market valued economy. They wanted short, no-nonsense haircuts. They were amazingly frugal – and they were always on the lookout for a deal!

The Jenison market was a perfect place for a grooming school with discounted grooming prices and basic trims! For 27 years, The Paragon School has been in this location. This community takes excellent care of its pets, but it doesn’t step far outside the realms of fancy haircuts. Short, low maintenance trim styles are what this clientele wants.

The other side of town has a totally different story. When we first started talking about opening a luxury pet resort, I knew exactly where we needed to go: right to the heart of where most of our mobile clientele lived. In 2007, we opened Whiskers Resort and Pet Spa.

Our first groomers at the resort were high-end pet stylists. They were Certified Master Groomers and awarding-wining contest stylists. They set the stage for a high-end thriving grooming department. The trims were more upscale and so was the average price. Upscale grooming comes at an upscale price.

Today, Whiskers has seven grooming stations and business is booming. Rarely do we see a short, low maintenance all-trim come through the doors.

Show GroomAt Whiskers, the team specializes in more complex haircuts. The team does lots of breed profile trimming using pet grooming techniques. They use special products to accentuate the coat type. They hand strip. They hand scissor. They do pet trims. They even do a few show grooms. They see oodles of Doodles and lots of “designer dogs.” Don’t get me wrong, about half of the grooming jobs are still bath and brush dogs. They handle plenty of Labs and Golden Retrievers! Plus, the Whiskers grooming department sees the new, different, and unusual when it comes to breeds. This team must be on their toes. Our stylists need to be up-to-date and highly educated to meet the needs of the clientele. They do a lot of fancy haircuts!

Both businesses cater to a different clientele. They are on different career paths both for the people within the teams as well as the businesses themselves. Both businesses are successful.

Most pet grooming businesses do a bit of a crossover between no frills, low maintenance haircuts and the fuller, fancier trim styles. The personal motivation of the salon owner, local competition, as well as the clientele will ultimately dictate the type of grooming styles leaving each business.

I know many salons that specialize in low maintenance, easy trims combined with bath and brush type pets. Even though they don’t do fancy trims, they are still highly successful.

Other salons cater to a more discerning clientele. They need to have a higher skill set to stay competitive and thrive in that setting. The more knowledgeable and skillful they are, the more likely they can satisfy their clients.

Other stylists cross over into the show world where the understanding and application of structure and movement combined with sculpting the coat is critical to being in the ribbons.

Regardless of where you fall on the scale, if you are a professional pet groomer/stylist, grooming is a career. It’s not a hobby to you. You might be doing low maintenance trims that don’t require a whole lot of advance study – that’s okay! Not everybody has to do fancy trims. Each grooming business will have a signature style.

You might be at a salon where if you’re going to thrive, you need to be able to satisfy a more demanding client. You have clients who are educated and know what their dogs are supposed to look like – or WANT them to look like! Being able to apply pet grooming techniques to enhance a particular breed or an individual dog is just good business.

It’s important to remember that owners have pets for different reasons. Not all owners want a “show dog” look. They simply want a handsome family pet that is clean and well-groomed. Sometimes that means a no-frills type trim – other times, it’s a much fancier haircut.

Whatever YOUR signature style is – do it to the best of your ability with kindness and respect for the pet. It’s our job to assist the owner to care for their pet in a manner suiting the pet and their lifestyle.

Happy trimming!

Melissa

 MVpaw_no_Inner_whiteWhat does your clientele want? Jump on the Learn2GroomDogs.com Facebook page and tell us about it.

 


 
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