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In your salon, lotion sales performance is and will always be the most significant piece of the profit-and-loss pie. In other words, if you want to make more money, sell more lotion!
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However, for some of our team members, selling can be a tough job – tough on the ego, tough on the energy level – which explains why it can be extra challenging to motivate your staff to face their fears, engage with every guest and sell each of them multiple tanning and beauty products!
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Motivate that young sales team to move the sales needle higher. Most top-earning salons with the highest lotion sales offer their staff some form of performance-based pay (PBP) whether it’s an hourly rate plus percentage of sales (commonly called commissions) or some type of cash/prize bonus for hitting a sales goal, or both. All these are considered performance-based pay programs.
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Call it what you want, but the top salons “show their sales staff the $” by structuring creative, well-conceived PBP. While the programs can differ slightly from one salon to another, the operators who create the most effective ones all tend to follow some simple rules:
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- They always implement daily, weekly and monthly incentives, so there is always something to work toward.
- They make sure to know what motivates each staff member, so that they can make bonuses/prizes really enticing.
- They create an equal balance of individual incentive and overall team incentive, in order to avoid having an overly-aggressive atmosphere that pits team members against each other.
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The following is an example of a PBP used by a very profitable salon that used to pay a straight percentage (anywhere from 4-10% depending on the product type), but when her state raised minimum wage, she found it necessary to change up her formula.
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At this salon, staff always earns commission on sales of EFT packages (anywhere from $5-$10). PRODUCT commission is based on LPPA (lotion per person average), which is found by taking the total product sold/total number of tanners.
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So:
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LPPA of < $1.49 makes $0
$1.50 -$2 = 4% of product total
$2.01 – $2.99 = 8% of product total
$3 – $3.99 = 10% of product total
$4 – $4.99 = 15% of product total
$5 & up = 20% of product total
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In this system, staff has the opportunity to make a tremendous amount of extra money, but they have to work for it! Those who “fly under the radar” are going to make very little or nothing at all.
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The salon operator posts weekly LPPA updates on her team Facebook page, so that each person knows their sales numbers are during the month, and everyone knows where they stand within the team (because no one wants to be at the bottom of that list!)
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The salon operator says that since converting to this system, she has paid more commissions on the whole, but has also made more profit, as well. Her top-seller made just under $700 in commission while selling $3,800 in lotion, as well as an additional $150 from teeth-whitening and EFT membership sales.
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In addition, the salon has a monthly goal (as a whole) based on the previous year’s total. For every $1,000 that the team exceeds that goal, every team member gets $25 in “Bonus Bucks” to spend on lotion, upgrades, spray-tans and basically anything in the salon. The staff recently blew their goal out of the water and each earned $125! The operator decided to change it up for this month and treat the team to a fun night of dinner, bowling or whatever they choose if the goal is reached.
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“I got 99 problems and money could solve at least 86 of them.”~ Author Unknown
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Most top-earning salons with the highest lotion sales offer their staff some form of performance-based pay (PBP).
