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Old 09-02-2011, 11:52 AM   #21 (permalink)
 
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Re: My friend is selling his salon

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Originally Posted by delany View Post
You do not reduce the overhead dramatically, you still need to pay yourself. If you are working for free, you have a hobby. I do not want to work 80 plus hours a week even split between me and my spouse for free. How do you feed yourself, pay your mortgage, recoup your investment? I know it was cheaper for me to hire someone than to pay myself what I would need to survive.

One of my biggest pet peeves in this industry. The amount of people that think they are doing really well, but yet either do not pull a salary or pull a below minimum wage salary.
We take enough money out to pay our personal bills in addition to the shop's expenses. All together, we can pay *everything* (including electricity) for about 3300 a month. Which comes out to a little over $100 a day. Even in our slowest time (just passed), we were making $70-$80 a day, and during our busy season we will be making $500+ per day easy which will MORE than cover the slow time.

We keep out enough money for gas, eating out (occasionally) and plow the rest of it back into the salon. After expenses, we're anticipating making about $45,000 this year.

One good thing about working all the time, you don't have a chance to spend much money! LOL

dongal
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Old 09-02-2011, 04:58 PM   #22 (permalink)
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Re: My friend is selling his salon

90 hours a week (12 per day for M-S and 6 on Sun.)
52 weeks a year
4680 hours (not counting the extra hours when 2 work at once)
$45,000 divided by 4680 = $9.62 per hour

Reserve for equip replacement in 5 years - $0.00
Return on investment - $0.00
Compensation for risk - $0.00

That's a rough row to hoe.

Fast food assistant managers get $25,000 to $40,000 plus health insurance, paid vacations, and 401Ks along with some time to enjoy life.
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Old 09-02-2011, 05:27 PM   #23 (permalink)
 
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Re: My friend is selling his salon

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Originally Posted by Ken View Post
90 hours a week (12 per day for M-S and 6 on Sun.)
52 weeks a year
4680 hours (not counting the extra hours when 2 work at once)
$45,000 divided by 4680 = $9.62 per hour

Reserve for equip replacement in 5 years - $0.00
Return on investment - $0.00
Compensation for risk - $0.00

That's a rough row to hoe.

Fast food assistant managers get $25,000 to $40,000 plus health insurance, paid vacations, and 401Ks along with some time to enjoy life.
I don't know about that stuff. Sorry, I'm not financially educated. In 5 years we will have all of our debts paid off and a nice little chunk of money in the bank so we will sell the salon at that time. Without debt, we can live very nicely on 15k a year, so the money that we have saved up should last quite a while, even longer if we supplement it with a part time job now and then.

The last "JOB" I had was $9.50 per hour, with no benefits or vacation time, so it's not a lot different than what I was used to. Besides, I get to wear shorts and flip flops and t-shirts so that is worth a fortune to me right there.

Just for the record my husband and I BOTH work about 80 hours a week and make $45,000, so that actually comes out to about $4.81 per hour each.

dongal
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Old 09-02-2011, 07:59 PM   #24 (permalink)
 
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Re: My friend is selling his salon

WOW! I closed my salon and I was making WAY more than that and working less. I guess everyone has what they consider success. I could get a job at starbucks making $10 an hour min, get benefits, not have the weight of a business on my shoulders.

I guess I look at things differently. I had bought my salon as an investment, worked under 20 hours a week, still pulled a nice salary from it as well as from my career. It paid back the investment in 2 years. My current sunless salon, if I wasnt making what my old job made me (or more) I would go back to working my old job. I have worked too hard in my life to live off of $15k a year for 2 people. I am not greedy per say, but I def need to make more than I did when I was 16 years old. Heck I couldnt live off of 15k just myself, and I am pretty cheap. ;)
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Old 09-03-2011, 06:23 AM   #25 (permalink)
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Re: My friend is selling his salon

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Originally Posted by dongal View Post
I realize that this conversation is pretty much dead, however I would like to offer my point of view.

First of all, it is not necessary to have four employees. My husband and I own a salon that has 8 lay down and 1 stand up. And we work it EXCLUSIVELY ourselves. On slow days we split the shift of 9 - 9 and on busy days we work the full day together. We are open 7 days a week (but on only noon to 7 pm on Sunday!!!) If you work the store yourself or just have one or maybe two part timers you can reduce your overhead dramatically.

We have only been open since March and average about $3,000 per month and are doing great. Keeping overhead down makes a huge difference.

dongal
To keep from burning out, perhaps now that you are in slow season, you guys might be able to lower your hours some. In doing this, it would give the person NOT working time to consider a second job, time to work on marketing for the salon, time to work on things around home, etc. Working 80 hrs/week - each - will quickly strain your energy and can be tough on a marriage over time.

Ideally, that $3000/mo will grow quite a bit next busy season when people know you are here - and you will make quite a bit more and this will be an even better investment!

Continued best of luck!
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