Case Study #3: New Owner, Existing Business
When the owner of a hip, college-town salon abruptly moved, Anna Bryant jumped at the chance to buy the business. Anna loves making people look their best. In addition to her entrepreneurial spirit, she has enthusiasm and vision to spare. However, she lacked some of the business skills and experience required to make the salon her own and turn it into a thriving venture.
The challenges: Our first goal was to define the brand and a clear vision for the successful salon Anna intends to create. Existing businesses have clientele, employees and identities, but not always the ones you want. Next, numerous management issues loomed before her, most prominently, employees and finances. Anna found that as an owner responsible also for overhead she was making considerably less money than she had as a stylist, and with more headaches! Finally, Anna wanted to know marketing techniques that would enable her to build the salon she envisioned.
The process: Anna met with us several times in the first few months to define the brand and her vision for the company. Her team of stylists participated in some of these sessions to share their ideas of their ideal clientele and what made their salon unique.
The clearer the business identity became, the more obvious it was that some employees did not have the skills or attitude to grow into Anna’s vision. Some of them realized this and left on their own. Although the people issues were very painful for her, Anna was vigilant about being true to herself and the decisions she had made about her brand.
A business owner isn’t in control without understanding the financial situation. When we began, there was no formal tracking of sales in terms of clients per month, average purchase, percentage buying products in addition to services, etc. Without tracking this information, it’s useless to do a promotion, since you won’t know what works and what doesn’t work.
We began with the end in mind by determining how much Anna needed to make per year, wanted to make ideally, then put together a roadmap to getting her there. The first step was to specify the actual cost (versus price) of every service. As soon as we did this, Anna could see pricing inconsistencies that were at the root of her business’s poor financial performance.
“I just wanted to thank you so much for your help. I can’t tell you how much you help ground me. I stress out and go in circles, and then I finally call you, and you put it so simply…whew! I love meeting with you. You give me such empowering ideas and the energy to go with it. You have had a hand in helping me develop as a person and a business owner. These things are invaluable to me. Thank you for sharing your time and your talent.”
As Anna began to implement her marketing, she found choices became easier to make because she was extremely clear about the brand. By asking a few simple questions, she could – on her own – allocate her marketing funds more effectively. We experimented with a number of techniques that Anna enjoyed doing and worked on developing messages that made each form of outreach to her target clientele more compelling.
The results: Sales are up 30% over prior year, and due to the volume of business, Anna is raising her prices. The salon now has a strong identity, clear messaging, and a consistent look and feel in its marketing materials. Anna feels much more in control of where the business is going and what she needs to be doing. She replaced problem stylists with a group she trusts to deliver the high quality and service her premium brand demands. She reports that a more appropriate, professional clientele is now frequenting her salon instead of commuting to the city.
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