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How to Sell Your Salon – By Uncovering the Hidden Value

by Marnie Kallmeyer | Jul 12, 2021 | The Smell of Success

Marnie here,

When I sold my first salon business, I got a fat six figures for it.

Now, for most owners of a typical hair or beauty salon, that seems like an awful lot of money to ask. And it is, but I was able to get it because I’d uncovered some hidden value that your garden-variety business broker or accountant wouldn’t even think to look for.

Let alone your well-meaning friends and family.

I was reminded of this when I took a phone call from one of our Members the other day.

“I’m going to put my salon on the market,” she said. “I’ve worked hard for five years, it’s time to start a family.”

So, I asked, is the business ready for sale?

“I think so. I take a good salary, we have great products, lots of regular clients, and the salon looks wonderful and it’s in a great location…”

But when I started asking questions, I could tell from the tone of her replies that this was going to be a disappointing conversation for her.

And that’s because there’s a gaping difference between what the owner of a business thinks has value, and what an astute prospective buyer thinks is valuable.

(And I use the word ‘astute’ with caution. With stars in their eyes, many a beauty therapist or stylist on the hunt for their own business will fall in love with the ‘pretty’ surface and fail to look at what really matters.)

First, the ‘standard’ way to value a business.

Financials (obviously).

An accountant will look at a business the way accountants do, with a calculator, analysing past performance, profit and loss, assets and liabilities, and come up with a ‘valuation’ for you based on those bare essentials.

Valid, certainly, but extremely limited, and limiting. Past performance is only half of the story.

Stock, fixtures and fittings and shop lease (again, obviously)

Yes, they may have some value. But have you ever tried to sell second-hand furniture? It’s worth next to nothing. Retail products?

You’ll need to be a very good salesperson to get anything like what you paid for it. And an astute buyer will screw you down on the remaining term of the shop lease, knowing you’re legally obliged unless they’re prepared to have the lease assigned to them.

Then there’s that hoary old chestnut,

Goodwill.

It’s just air. Business vendors will, usually on the advice of their accountant/broker/business coach, attempt to ascribe a dollar value to that most intangible of intangibles, the ‘goodwill’ or loyalty of the customers to the business.

These days, there is little or no loyalty. And buyers know it. Don’t even think about trying to pull that one over them.

Now to the stuff you haven’t thought about, and certainly your accountant hasn’t….

Your database.

By far the most valuable, most measurable part of your business is your list.

Your list of clients, customers and prospective customers held in an orderly, well-maintained electronic database containing not only their full contact details (name, email address, phone number, and most importantly, physical mailing address) but their spending habits and booking frequency.

This is the gold. This is the thing that a buyer can look at and determine with reasonable accuracy the current health of the business, and its potential, given a more robust and refined marketing program.

If your software program is set up correctly, a prospective buyer will also be able to determine what marketing information you’ve been sending out to that database, and its responsiveness.

Your list has a strategic value in and of itself. If I were buying a salon, it’s the first thing I’d look at, not the financials of the business. I’d then put that list alongside the financials, and try to find cause and effect.

Then I’d take a very close look at the thing that really matters…

Your marketing infrastructure, both online and offline.

The second most important, most valuable, and easily the most measurable asset of any local business like a hair or beauty salon is…drum roll please…your online presence.

Thanks to technology, an astute buyer will demand your Google logins.

Why? Give me your Google account logins and within one minute I’ll be able to tell exactly how many phone calls and website visits you’ve had in the last 30 days or 90 days from people searching for a hair salon or a beauty salon in your area.
Here’s an example; the Google Insights figures for one of our Member salons, in a suburb of Melbourne….

It shows that this salon received 346 phone calls in the last 30 days from people who had Googled a hair salon in that suburb, and called the business using the ‘click to call’ function provided by Google.

Think about that; three hundred and forty six phone calls, just from people finding the salon in a Google search.

In addition, the salon received 511 clicks through to its website from the Google Plus listing in search results, which would have produced another raft of phone calls.

This is important, value-adding stuff.

For a prospective buyer, it is proof that the investment put into online marketing by this salon owner is paying off in easily-measured numbers.

It means I, the buyer, can count on getting a steady stream of appointment-producing phone calls. And that means sales, and profits.
And that means you can put a defined value on that online presence, quite apart and separate from any valuation your accountant might put on past revenue and profit.
(You should also know – and Google provides the tools to find this out – how many people are searching online for a hair stylist or beauty therapist in your area in any one month period.)

Your presence in social media also matters, though not to the extent that Google ranking does. How many Facebook fans you have, how many Instagram followers you have, matters in that it gives a buyer a sense of how active and productive you are on social media.

But don’t be fooled, or try to fool – Facebook and Instagram followers are not customers. They’re just fans.

People who actually call your business are customers (or potential customers).
So yes, financials and balance sheets matter.

But smart buyers know they’re only part of the story. And they are past history. The only figures that can give me a picture of the future are those produced by the marketing metrics above.

If you don’t know what your marketing metrics are, then you – and the buyer – are floundering in the dark.
Those crucial figures – proven phone calls, your Google ranking, the size and quality of your database of clients, and yes, to some extent your social media engagement and activity, can all be presented as adding extra value to your salon when it comes time to sell.
Okay, so what to do now?
First, take a look at your website using our FREE website analyser. Just type in your website address and our analyser will tell you how many errors there are…and you’ll get a FREE report on what they are and how to fix them.

So yes, financials and balance sheets matter.

But smart buyers know they’re only part of the story. And they are past history. The only figures that can give me a picture of the future are those produced by the marketing metrics above.

If you don’t know what your marketing metrics are, then you – and the buyer – are floundering in the dark.

Those crucial figures – proven phone calls, your Google ranking, the size and quality of your database of clients, and yes, to some extent your social media engagement and activity, can all be presented as adding extra value to your salon when it comes time to sell.

Okay, so what to do now?

First, take a look at your website using our FREE website analyser. Just type in your website address and our analyser will tell you how many errors there are…and you’ll get a FREE report on what they are and how to fix them.

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Get your free copy of the Salon Business Plan Template here.

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3 Ways to Keep Your Salon Sales Up with “Pandemic Proofing” Against Covid-19

by Greg Milner | Apr 9, 2020 | Online Marketing

Do you feel the lockdown is a disaster, or…an opportunity?

Get a FREE 30-minute “Massive Action” strategy session with WSM’s founder & CEO Greg Milner and find out how YOU can take advantage of the downtime to keep the cash register ticking over.

AND be ready to hit the ground running when the crisis is over.

Hit the button below now and choose your day and time for a free strategy session with Greg.

Book your free strategy session here

Thousands of salons all over the world have been forced to shut their doors due to coronavirus.

Many owners are frozen in fear.

But the crisis WILL end.

And there ARE actions you can take to prepare yourself for when the lockdown is over – when you can open your doors again.

The salon owners who are using the down-time to fine-tune their marketing and online assets are going to be in the best position to hit the ground running.

As soon as long-time Worldwide Salon Marketing member Effie Tsopolous was told to shut down her big Hobart skin care centre, she was on the phone to us.

“Help!” she said. “I need to make changes FAST to our website and Facebook pages so we can at least sell retail products, gift vouchers, and promote skin consultations by Zoom video.”

So our team of developers went to work. First, a major update to Effie’s home page:

(Click on image to go to Escape’s home page)

Then, designing a new page and uploading a raft of images of the products she wanted to sell online:

(Click on image to go to Escape’s online shop)

Next, an overhaul of Effie’s Facebook page, with a new cover photo, and tweaking the page to allow for online booking of free skin consultations:

(Click on image to go to Escape’s Facebook page)

“Being quick to make these changes and updates is already having an effect,” says Effie. “We’re getting sales online, and we haven’t even started making phone calls to clients or emailing them with links to the site.”

Here’s another example of a salon taking “Massive Action” to keep the cash register ticking over during the coronavirus pandemic.

Karen Skewes is an award-winning owner of Le Beau Day Spa in Perth. This morning, she sent out this carefully-worded email:

Do you feel the lockdown is a disaster, or…an opportunity?

Get a FREE 30-minute “Massive Action” strategy session with WSM’s founder & CEO Greg Milner and find out how YOU can take advantage of the downtime to keep the cash register ticking over.

AND be ready to hit the ground running when the crisis is over.

Hit the button below now and choose your day and time for a free strategy session with Greg.

Book your free strategy session here

Trouble Closing Sales?…Try This!

by Greg Milner | Aug 6, 2019 | Sales Prevention, Selling Salon Products, Uncategorised

Have you ever had that sinking feeling, after you’ve spent time enthusiastically explaining a service or treatment to a client…

…and you stop, and wait, and she says…

“Thanks…I’ll think about it….!”

And that’s where you go “oh, damn, lost that sale…”

You can have the best marketing on the planet – the right offer, the perfect Facebook page, a website that dazzles, a salon that screams quality, happy and accomplished staff…but if you haven’t worked out how to actually get the sale once all that marketing has created an inquiry, it’s all for nought.

The late, great American sales mastermind Ziglar was fond of saying “poor sales people have skinny kids”, and he’s right.

So many of the businesses I consult with have great marketing, but they also have what I call a finely tuned “Sales Prevention Department.”

I bet you’ve heard sales people say it’s all about “handling objections,” right?

John Blake is an accomplished sales trailer of my acquaintance, whose business is helping business owners increase their sales.

This is what John teaches about “handling objections”:

“For a start, If you are getting objections, especially at the tail end of your sales process, what it means is that something is broken at the start of your sales process and most times, it’s happening way before you get to the end or to the “closing” part of the conversation.

What I find when I work with clients on their sales process is when we fix the front part of their process for handling new enquiries, we rarely if ever get objections at the end.

So what are your options if you haven’t had your sales process optimised and this does happen to you…

1.If it’s a question, you can simply answer it

What can also be really useful is to know in advance how to better answer common questions in a more powerful way. What I normally suggest is a list of frequently asked questions or FAQ’s but also a list of questions that people who are in the market for your product should ask which are called SAQ’s
This will go a long way toward keeping a sale on track.

2. If it’s a mis – understanding, you can dissolve it by simply clarifying the point in question

Often an objection can be dissolved simply by doing this.

3.If it’s a stall or a decision to postpone the decision

What I normally suggest and do myself, is to ask “when would you like to continue the conversation?”
This effectively does two things, it puts the onus back on your prospect and makes it their idea as to when to talk again. And because it’s their idea, when you do contact them again, you are doing so on the date and time that they said.

Never do this:

Where sales people get into trouble is when they try to trick people into buying by using “linguistic binds” that attempt to force someone into a pressured decision. There are sales training programs that teach these things and whilst they may get you some short term sales, long term they end up being toxic to your business

Here’s why

1.Potential clients hate it (and will go tell the world how “pushy” you are)
2.Even if they do become a client they will be the client from hell (I know because yep I’ve tried it)
3.If they do become a client and they actually stay, they will never refer or subject anyone they know to the torturous process they went through with you to become a client.”

Good advice, don’t you think?

If you want to know more of John’s work, check out his website here.

Speaking of websites, is YOURS functioning like the best ‘unpaid salesperson’ it should be?

If it’s not, we’ve got a FREE tool for you – our brand new Website Analyser – just enter your details below, including your website’s address, and you’ll be send a FREE, 30+ page report that you can send to your website designer and say “fix these please!”

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How this salon QUADRUPLED sales – in two months.

by Greg Milner | Aug 7, 2014 | Advertising Tips, Featured, Getting Salon Clients Quickly, Increasing Retail Sales, Newsletter marketing, Selling Salon Products, The Right Mindset, The Smell of Success

Achieving a massive increase in salon sales isn’t actually all that difficult – IF you’re prepared to to take Massive Action.

At Labella Beautique in Rockhampton, Queensland, owners Deanne & Shenae joined Worldwide Salon Marketing’s My Social Salon program in late May 2014. Two months later, they’d quadrupled their sales with a concentrated marketing effort using easy offline and online marketing tools & templates downloaded from the Members Only ‘sealed section’ website.

Admittedly, they were coming off a low base – but if a young (8 months old) little salon in the back blocks of regional Queensland can do it, any salon can. Here’s how Deanne and Shenae describe their marketing breakthroughs…

[cf]Labella[/cf]

Labella Beautique is a Member of the My Social Salon marketing & mentoring program, the world’s most comprehensive, done-for-you, online and offline marketing system developed ONLY for salons and spas. Membership is strictly-limited and available only for those salon owners who want to be business owners, nor merely therapists or technicians.