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Old 09-07-2012, 10:57 AM   #1 (permalink)
 
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New To The Business. Need Advice

My wife and I purchased an existing salon. We had tossed the idea around for months and due to a weird series of circumstances we were able to buy a 10 bed salon for a little less than 20k.

We took a small personal loan and a chunk of savings to purchase. The limited funds we have are going towards marketing (stressing the "new" ownership). We are in a mid size college town. We've done flyers, student / faculty promos, FB and Twitter and ads in local and school papers.

We have changed names and have been open since July. I know we jumped in during "off" season so we're not in a panic...yet. Our only problem so far has been previous customers with unfinished packages from the previous salon (the former owner closed kinda abruptly). We have accommodated the best we can, but we are afraid we are fighting to disassociate from the previous salon.

Our Salon:
(2) Ergoline Ambition 200 beds
(2) Tropical Series 41 UPP
(2) Ergoline Ambition 450
(1) Solaris 542
(1) Ergoline Avant Garde 600 (most popular)
(1) Suncapsle Cyclone
Tan Track software / combo of Tmax and Intellitan timers

I removed the Sun Series SL424 and placed it in storage. We also have a Norvell Spraysystem (not familiar with it, for some reason the wife doesn't let me spray down naked women). So we have room for one more bed? Any suggestions?

Pros:
Location - College town located directly across the street from Louisiana Tech University girls dorms.
Maintenance - I am an engineer by degree and computer nerd by trade so I have grown comfy with beds, tmax and tan track.

Cons
Lease - pretty steep, but we think our location may be worth it (maybe)
Inherited Unhappy Customers - Caught in the middle between a few unhappy customers and their issues with former owner.
Inexperience - A little worried, we have seen the slow season, but have never seen the "busy" season.

I understand marketing is important. I tried reaching out to the existing customer base via tan track email marketing but eh....not sure its all that great. We are going to continue to work on getting our name out. Is there anything else we need to be doing that we are overlooking? Any suggestions on a bed to add? Anyone else in a college town with advice? We are considering products from jewelry to tshirts to ???

Sorry for being so long winded, thanks.
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Old 09-07-2012, 12:47 PM   #2 (permalink)
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Re: New To The Business. Need Advice

If you have the database then offer to honor the existing packages provided the customer purchase a new one. Don't just absorb the old packages. Tell them that you will reinstate their old package if they also buy a new one of equal or greater value.
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Old 09-07-2012, 01:31 PM   #3 (permalink)
 
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Re: New To The Business. Need Advice

We do have the database and have become more proactive. We have sent emails explaining new ownership. We've offered 25% off any level package and apologizing for the confusion (which feels like taking blame for something thats not our fault).
Yet even with a new name, new faces, signs saying "new ownership". We still have people who dont grasp the facts and insist we owe them their money back or we have to honor their minutes.

Its a delicate situation, because word of mouth is powerful in smaller towns. Its a sticky situation that I hope will pass without damaging our rep.
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Old 09-07-2012, 02:12 PM   #4 (permalink)
 
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Re: New To The Business. Need Advice

Why wouldnt you honor their packages? They are instant customers that you are ******* off! When I bought my salon, I changed beds, name, etc but honored packages. Yes you didnt make any money from them, but I negotiated that into my purchase.

I think you are doing bad things by not honoring packages, especially in a college town...word of mouth travels fast.
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Old 09-07-2012, 03:08 PM   #5 (permalink)
 
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Re: New To The Business. Need Advice

I agree with Delany. If you don't absorb their packages, and they ARE tanners (harder to get these days) they will just go somewhere else and never return to you. A customer who likes your salon and spreads positive things about you, the new owners, is worth far more than the cost you have running the beds. hope it's not too late.
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Old 09-07-2012, 03:23 PM   #6 (permalink)
 
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Re: New To The Business. Need Advice

Also, remember these customers feel cheated, as they WERE cheated out of tans they bought and can't use. I would be mad too. You don't owe them this, but in the long run, it will pay off for you when they run out of tans and purchase more from you. You already have a battle of renewing the damaged reputation from the previous owners. If one of my competitors would close, I would jump on the oportunity to honor their tanners packages.
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Old 09-07-2012, 06:27 PM   #7 (permalink)
 
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Re: New To The Business. Need Advice

You are all correct. It is frustrating when you have customers, yet you aren't making any money. In the long run it will be ideal if they all turn out to be "regulars" and it pays off down the line. So honoring existing packages makes sense and we'll go for it.

We have the benefit of looking up history in Tan Track. Unfortunately, we've already had a few customers with bad memories who insist they had a Level 3 Unlimited Month package, where Tan Track shows a Level One Unlimited Week. That scenario has occured 3x already. I'd like to think thats a "few bad apples" dont want to be taken advantage of...its a touchy situation
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Old 09-07-2012, 06:55 PM   #8 (permalink)
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Re: New To The Business. Need Advice

Re read. If this salon was purchased open then of course you honor packages. That should have been negotiated with the prior owner.

If the salon was closed and you took over then you owe them nothing and you offer to reinstate as I explained before.
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Old 09-07-2012, 07:05 PM   #9 (permalink)
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Re: New To The Business. Need Advice

Congratulations - and Welcome!

A few thoughts:

1. Absolutely with NO hesitation - honor the existing packages! There isn't an easier/cheaper method of marketing out there!! The "cost" to you to honor them is very little -- and the benefits are huge!

2. That said, before you get established, time to review your pricing ASAP! You mentioned "minutes". Minutes is the number one WORST way to sell tanning for a salon owner. If you want - either post your pricing here or message it to me or email me (ann.wiggins.noe@gmail.com). That is one of my areas of expertise - and a good pricing plan can make all the difference in being profitable or not!

3. Wait on adding another bed - for now. Let things settle in for you, establish your new pricing, see how your usage and clientele shakes out. THEN see what you should offer! HP is a naturally possiblity - but so might another nice VHR to go with the Avantgarde!

4. In the meantime - make sure the equipment you DO have in there is running top notch! Do you have any idea of how many hours are on your lamps? You want to make sure they stay fresh. Are the acrylics in decent shape. Beds are clean, detailed and buffed up to look sparkly? These things all signal new ownership - and an incentive for customers to stick with you!


Lots to take in, but sounds like you are on the right track. That said - WELCOME those customers with existing packages with a smile.....and get that pricing where it should be!
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Old 09-07-2012, 07:38 PM   #10 (permalink)
 
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Re: New To The Business. Need Advice

Quote:
Originally Posted by Brian Oshman View Post
Re read. If this salon was purchased open then of course you honor packages. That should have been negotiated with the prior owner.

If the salon was closed and you took over then you owe them nothing and you offer to reinstate as I explained before.
Actually, we had to have the sale paperwork re-drafted to omit any references to us purchasing "existing liabilities". I guess I should not have referred to the salon as an "existing" salon. It was literallly operating minimal hours with a skeleton crew, yet accepting new customers practically up to closing. We closed the doors for one week to paint and redecorate then reopened.

We had people showing up confused, some knew the salon was closing. Some had no clue. Some assumed packages would carry over. The change was not smooth, we didn't anticipate this problem.
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