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Structuring help
#1
I have my own small salon. Last year I hired a young girl 19, to assist me. She has now decided she would like to go to nail school, which starts in January. I am training her and have her practicing on my clients doing polish changes, manicures, and pedicure polish changes at this point. In Florida she can apprentice under me as long as she does not receive any type of compensation from the CLIENT. We just decided two weeks ago to move forward with her training and I have to say this girl is going to be amazing. Anyways, I don't know how to financially handle the situation. Now, during this time, and in the future when she will be licensed. I want to be fair and tend to be on the generous side. I want to start out with a sound plan that is profitable for both of us. Thoughts from experience?
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#2
(09-06-2012, 08:36 PM)its an art Wrote: I have my own small salon. Last year I hired a young girl 19, to assist me. She has now decided she would like to go to nail school, which starts in January. I am training her and have her practicing on my clients doing polish changes, manicures, and pedicure polish changes at this point. In Florida she can apprentice under me as long as she does not receive any type of compensation from the CLIENT. We just decided two weeks ago to move forward with her training and I have to say this girl is going to be amazing. Anyways, I don't know how to financially handle the situation. Now, during this time, and in the future when she will be licensed. I want to be fair and tend to be on the generous side. I want to start out with a sound plan that is profitable for both of us. Thoughts from experience?




Check these threads out to see if it can get your started.
Compensation<< click here

OR

Wages<< click here (some of these may be duplicated from above)
Anna
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#3
You really need to look at your total financial picture to be able to evaluate what fair pay is. Knowing your monthly overhead, service costs, wear and tear on equipment, etc. is very important. From there you will be able to evaluate what your costs per service are when paying someone.

When I set up my pay structure (hourly plus commission), I put it in a spreadsheet so I could see the numbers. I will tell you up front, if you put together a pay scale where the second person is actually making more money than you as the salon owner, they will still think they can make more without you, because they don't know what it costs to run a shop. That's my experience anyway. Smile

You would need to know your own averages, based on your service prices, but just to give you an idea, here's what my scale looks like...

Costs on services (not including overhead) run at about 22% of the service price:
-7% to supplies
-5% to equipment & tool replacement
-4% to advertising (this will be too low probably)
-4% to the client loyalty program
-2% to credit card fees

Employer taxes on services:
-7.65% matching soc. sec.
-6% unemployment/workman's comp
-(In WA the business also pays 1.8% of GROSS income to the state)

So, let's say you decide to pay out 60% to the other tech - you would actually be paying out 95.65% total -
60% tech
22% costs
13.65% taxes
and only getting 4.35% for the salon - which is NOT profit, because that didn't take into account the overhead that you pay.

Be generous, pay them what they're worth - but make sure that you are not paying them out of YOUR earnings from YOUR services!

I worked with a business coach last Spring when I was hoping to hire an employee - so I have a detailed employee manual (I highly recommend that!) and she gave me the bones of a com. structure, although I bumped the numbers higher. The basic component listed below is a necessary piece of the puzzle - it's the piece that ensures all the costs of running the salon are covered:

For an hourly wage plus commission schedule - the hourly wage (9.04/hr here in WA) is paid for all hours worked, and commission is paid based on service volume. Service volume must be double the hourly wage paid, then the commission is paid on every dollar over that. So, if someone works 40 hours a week their wage is $361.60 - so they get that, plus com. on every service dollar starting at $723.20. The com. schedule then is graduated based on volume - the exact amounts and percentage really need to be determined based on your overhead and your service pricing. [Those numbers may seem high, but keep in mind my service pricing goes from 25-84, someone doing only 30 services a week will on average have a service volume of around $1,300 without breaking a sweat.]

I believe that when I had my tipping schedule, it ranged from 25-52% com. paid on top of the hourly rate -and the no-tipping schedule got bumped up to 35%-58%, which put more money in their pocket than the lower schedule with tipping. Either way, the graduated scale on top of the hourly rate set-up basically pays a small amount to the salon for overhead, and after a certain point the bulk of additional profit goes to the tech.

Wow, that was long, sorry for the book! Smile
Candice
Nail Tech/Owner
http://www.PanacheNailStudio.com
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#4
Wow. This only makes me wonder why does anyone own a salon with employees and not on their own? Where is profit made?
Anna
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#5
Yeah, the profit is tough unless you have a bunch of people, or don't pay as well. For me it would come down to customer service, as I can't always fit new people in, especially on short notice.
Candice
Nail Tech/Owner
http://www.PanacheNailStudio.com
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#6
Thank you so so much for the info. Candace would you email me your phone number
[email protected] I would really
Love to speak with you. Also, what do I do for the next for the next 8 months while she is practicing on my clients regarding the use of all the products etc. Also, I allow her to bring her family members in during the times that I am closed. She is paid 10.00 an hour for assisting me, while she is working on my clients she is not being paid by me, and myclients are insisting on giving her a gratuity
Candace wanna make a trip to Florida!! Lol
Who did you hire?
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#7
I'm still amazed that you can employ someone in Florida that's not licensed and have them do services . . .

Candice, great information!
Jaime Schrabeck, Ph.D. (yes, it's real)
http://www.precisionnails.com
http://shop.precisionnails.com
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#8
Thanks Jaime!

I looked high and low and can't find the contact info for the coach I spoke to, all I have is the work product (notes) from our session. There are several coaching sites on the web, some offer coaching, some offer camps or systems that you can purchase. It's not cheap Smile So sorry, but I can't fly, so no trips to Florida for me! My number is 425.760.3911

Sorry, I just thought about the last question, how to handle things while she gets licensed. This really comes down to the laws in your state. One thing - I would talk to your insurance agent about having an unlicensed person performing services in your shop, even if she's not being paid. If I had to guess, I would say that your insurance won't cover any liability in this case, so you would be personally liable if someone were injured. That right there would stop me. Does Florida have an apprenticeship program? I just discovered that WA does, but you have to be approved by the agency handling that, as does the person doing the apprenticeship. It looks like in this type of program, the agency actually covers the insurance premiums and liability for the times when the apprentice is working during any unpaid hours. So I'm not sure worrying about charging for product or use of the salon during the practice sessions is the real issue - I personally wouldn't put my salon or personal finances at risk. This really depends on the rules in your state, though - so I would suggest that you thoroughly cover your behind before going forward. Smile

I just did a quick search - FL does not have an apprenticeship program - and it appears that it is not legal for your assistant to be performing any services on clients, so basically letting her do it is unlicensed activity. I copied the following from http://www.myfloridalicense.com/dbpr/pro...mo_faq.pdf

2012 JULY Page 3 of 12 DBPR: Cosmetology FAQs

When is a registrant (facial, nail, and full specialty applicants) eligible to work?
After successfully completing all school hours and submitting an application along with the required
fees to the department, and pending the issuing of the registration, an applicant is eligible to practice
under the supervision of a registered specialist in a licensed cosmetology salon with the following
conditions:
• Prior to beginning the performance of the specialty service, you must provide the salon owner
a copy of the completed licensing application and school transcripts that you submitted to the
department.
Candice
Nail Tech/Owner
http://www.PanacheNailStudio.com
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#9
Here is where it talks about services being performed as long as there's no compensation - it's pretty specific that the service can only be performed by an unlicensed worker if there's no shaping, coloring, arranging, etc. and that the work being performed must be to effect the sale of a product, not for the benefit of the service itself. Sorry to be a downer, but it looks like it is NOT legal to have her do any services, even unpaid.


http://myfloridalicense.custhelp.com/app.../a_id/1659
What services can I provide without having a cosmetology license?
Published 02/24/2012 08:30 AM | Updated 08/06/2012 04:07 PM
What services can I provide without having a license?
Any cosmetology or specialty service can be performed as long as no compensation is received for the service. Application of makeup for no compensation or applying makeup at a makeup counter or for an independent makeup company can be performed so long as the makeup application is solely for the purpose of selling the product and not for selling the service. Providing wig/hair piece fitting services can be performed, in conjunction with the sale of the wig/hair piece as long as no cosmetology services are performed (e.g., hair arranging, hair cutting, shaping, coloring, etc.)
Candice
Nail Tech/Owner
http://www.PanacheNailStudio.com
 Reply
#10
Isn't the manicuring course for Florida only 240 hours? That's not very long . . .
Jaime Schrabeck, Ph.D. (yes, it's real)
http://www.precisionnails.com
http://shop.precisionnails.com
 Reply
#11
(09-08-2012, 05:21 PM)PrecisionNails Wrote: Isn't the manicuring course for Florida only 240 hours? That's not very long . . .

There are no hours required in Connecticut to get a license and only 10 states that require at least 600. Crazy, eh? I was just reading an article in September's Nail Magazine about it. it says: "Inconsistency from state to state on hours required to sit for the test and what is tested and what’s not is another obstacle. Alabama requires the most hours at 750, while Alaska requires the least at 12 (and Connecticut doesn’t even require licensing to do manicures and pedicures). Some states approve apprenticeships and many don’t."

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#12
I was reading your percentage of costs and the part where it said if you paid out 60% of what the tech made to the tech, then you were in actuallity paying out waaaay too much to help cover the cost of the salon expenses in the long run. Ask any nail tech working and she'll vehemently say she will not work for any less. Having owned a salon, I've seen the results of paying out that much and you're absolutely correct, unless you have lots of techs working for you, 60% going to the tech leaves the owner with very little to pay her expenses with.

A sliding scale starting at 35% and going up according to how much the tech makes is more in line with being able to pay the tech and make the salon profitable.
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#13
The salon I work for ranges from 28-35% commission (they will pay a little bit of hourly for things like opening and closing duties and for services that were comped for whatever reason, but otherwise it's just commission). Initially I felt that was a pretty low commission, but I make far more working there than I did at a less busy salon making 50%. They also supply everything. I only have to pay for license renewal.
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