March 8, 2017
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What Happened to the Commission Based Salon?
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Long is lost the great commission based salon of the past. Don’t get me wrong, there are certainly some great commission based salons around, but they are becoming few and far between in todays salon landscape.
The commission based salon……a salon environment full of teamwork, ongoing education, and an overall desire to help all stylists thrive in this amazing industry. The same business model that rewarded the high producers with a competitive commission and acknowledged and incentivized the busy worker by paying them what they were worth. This same salon setting that made their employees W2 workers and reported all tips and incomes as they are supposed to be. This was the salon model that made this industry so exciting to be in, the business model that created a team atmosphere.
It’s becoming less common by the day to see salons operate under this once popular model. In the recent past, we are seeing other salon models to be more popular to the once thriving commission based salon.
More and more, we are seeing the “booth rent” setting is taking over. Pay your daily or weekly rent money and away you go. You can work when you want (sometimes), charge what you want (maybe), and have the clients that you want (hopefully). You generally are allowed to use the products of your choice and even sell the retail you desire. You are responsible for your expenses as well as paying your taxes. As you can imagine, this is a tremendous undertaking, especially for a new graduate. It is rarely the recommendation of Hays Academy to see our graduates in a booth rent setting; however there are circumstances that do make it seem to make sense. Those with a very large number of loyal clients may make the booth rent salon work. This type of environment requires a strict discipline of hard work and organization.
Becoming more and more popular seems to be the salon that appears to be commission based but their structure is not consistent with that model. More and more contracts are entering the hands of our graduates with interesting compensation details. Payment clauses read that the salon will pay the stylist the following Monday for all of their services rendered the week prior. In return, the stylist will be responsible for paying the salon a % of that check. We are certainly no attorneys, but this appears to be a way to avoid paying the employee taxes that relate to the commission based salon model. In addition to this payment structure, these contracts elude to the stylist being an employee, which seems to be a bit misleading in our opinion.
This is an amazing industry! Our hope and desire is that ALL salons will conduct themselves in a way that promotes the well being of the industry while operating with the utmost integrity. Our graduates deserve that, as do the hundreds of thousands of licensed professionals who engage in this field on a daily basis. Come back commission based salon……We MISS you!!!