John, what goals should I set for the New Year? Why are goals important and how can I stick to them and see results?
The key to making any salon or spa profitable is creating and tracking goals. Without goals, you remove the stepping stones and momentum it takes to grow your business. In order increase your bottom line, it’s important to focus on goals that are specific (growth indicator), measureable, attainable (educate them how to achieve their goal), realistic (small increases at a time), and time-bound (quarterly/yearly goals). For instance, don’t tell your employees what revenue-based number they need to achieve in the next quarter, tell them what specific growth metric they need to increase, and educate them on how they can increase it – which will ultimately result in an increase in revenue.
Just remember – goals aren’t just about rushing to the finish line. Your goals are the achievable, incremental milestones that will get you there. Each step is important on your journey to success. Goals shouldn’t be an end of the year chore, because they take the entire year to achieve. Create a plan that incorporates the entire year, with times to check in, assess, and adjust if needed.
Your goals should be specific and attainable, and based around growth indicators. The growth indicators are key performance indicators for the salon/spa industry. The Growth indicators (New Clients per Month, New Client Retention, Repeat Client Retention, Frequency of Visit, Average Ticket and Productivity) allow you to analyze how your business is doing in specific areas. Setting goals on growth allows your business to be forward focused because what they do today to increase each growth indicator will ultimately increase revenue tomorrow. For example, if a service provider’s current FOV is 4, their goal for the end of year should be to increase it to 5. This will drastically increase revenue. These types of goals require specific action items, and your software should help you stay on track. Millennium provides a real-time monitoring station so you always know where you stand.
Determining your goals and presenting them in front of your team is your first step to implementation. Discuss with your team how you will achieve these goals, so you can work together towards growth. For instance:
- If you want to increase your new clients per month, implement guest referral programs and preset email and social media campaigns around important holidays.
- If you want to improve your new guest retention, and keep them as returning clients, focus how on how you can make each guest’s first visit extraordinary and unique.
- If you want to increase your repeat guest retention, don’t let clients go more than 90 days without coming back. Work on crafting the perfect ‘We Miss You’ email and send after the client hasn’t visited for more than three months.
- If your frequency of visit is lower than you’d like, focus on how your front desk and your service providers can work together and pre-book your clients.
- If you want to increase your average ticket, discuss with your team specific dialogue that can be used when talking to clients about add-ons, as well as upselling and cross-selling. Make sure your team is well educated on all the products and services you offer, in order to give the best advice to customers.
Remember that growth must be achieved in small increments – so set plausible incremental increases for goals based off of your current growth indicator status; not industry averages and ideals.
Goals are a necessary part of building your business, and create a roadmap to success. Keep in mind that all of your growth indicators are intertwined and will affect the others, that’s why it’s best to focus your efforts based on the strengths of your business. Your software should help you asses where you currently stand, so you can create measureable and achievable goals and make the most of the New Year. If you would like a quick and insightful tool to show how much your goals could change your bottom line, check out Millennium’s Growth Calculator. I wish you the best of luck in 2017, and happy goal setting!
Millennium Systems International, Founder and CEO
About: John Harms, Founder & CEO of Millennium Systems International, creator of Millennium Software, has been designing industry leading salon scheduling software and educating the beauty & wellness industry since 1987. Today Millennium is utilized in thousands of businesses in over 38 countries and operating with approximately 150+ employees worldwide. Millennium currently runs its corporate headquarters out of New Jersey and its international office is based in the U.K.