It's a problem if you can't answer this question immediately! "What is your salon's sales per labor hour?"
Introduction: What I emphasized in the Premium Salon System lecture
Hello, I am Sakuma, representative of CHOKIP.
The other day, I served as a lecturer on "Management & Marketing" for the "Premium Salon System" conducted by the Japan Pet Salon Association.
For all members of the Salon Association, the video will be distributed soon, so please look forward to it!
<Japan Pet Salon Association>
https://www.japanpetsalon.org/
Now, one of the things I emphasized during that lecture is"the importance of sales per labor hour."This is a theme I have covered several times in other note articles and in my YouTube video series, "Choi-Kiki Cafe."
Today, in this article, I will provide a thorough explanation of "sales per labor hour" once again!
Why "sales per labor hour"? The business model of a grooming salon
It is no exaggeration to say that this is the most important metric in managing a grooming salon. That is "sales per labor hour."
To begin with, what is sales per labor hour?
The term might look a bit difficult, but the calculation is very simple.
In other words, it is an indicator that shows"how much revenue was generated by the staff (or yourself) working for one hour."What is important here is to look not only at "sales" but also at "hours worked."
For example, let's assume there are two salons with the same monthly sales of 2 million yen.
Salon A has a total working time for all staff of 400 hours.
Salon B has a total working time for all staff of 600 hours.
Both have the same sales of 2 million yen.
However, when you calculate the sales per labor hour, it looks like this:
Salon A: 2 million yen ÷ 400 hours = 5,000 yen
Salon B: 2 million yen ÷ 600 hours = approximately 3,333 yen
If you only look at sales, they are both the same, but the productivity per hour is significantly different.
Salon A generates 5,000 yen in sales per hour.
Salon B generates approximately 3,333 yen per hour.
This difference significantly impacts management in the following areas:
Whether you can raise staff salaries.
Whether the owner can take time off.
Whether you can invest in new equipment.
Whether you can spend money on advertising and training.
Whether you can withstand sudden cancellations or a drop in sales.
Sales per labor hour is deeply involved in these matters.
That is why I believe sales per labor hour is a very important metric for measuring the profitability of a grooming salon.
Why does this number have such an impact on management? It is becausea grooming salon is a "labor-intensive business."
A labor-intensive business is one where "human hands and time" directly become sales, rather than machines automatically creating products. Grooming is a prime example of this. The time a groomer spends performing the service and interacting with the dog becomes value, which leads to sales.
Therefore, to accurately measure a salon's profitability, it is not enough to just look at "this month's sales were XX yen." If you lose sight of the perspective of "how many hours did everyone work to achieve those sales?", you will fall into the following dangerous states:
Sales increased, but in reality, everyone was working overtime every day and achieving it while being worn out (a very low state when converted to hourly wages).
In a one-person salon, you are writing charts and posting on social media until late at night, leaving you with no personal time at all.
Even if you want to "give your staff a raise," you don't know where the funds would come from, and in the end, you cannot raise their salaries, leading to staff turnover.
If you do not know what your salon's "sales per labor hour" is, it is like driving a car while blindfolded. First, start by grasping this number as a "metric you absolutely must keep track of."
Don't worry about industry standards! How to determine your salon's "target value"
"I understand that sales per labor hour is important, but what should my salon be aiming for?"
You might be wondering that.
Actually, other than the descriptions in the "Pet Salon Management White Paper" published by the Japan Pet Salon Association, there is no clear "standard figure for sales per labor hour" across the entire grooming industry. However, that is fine. This is because,the numbers you should aim for vary completely depending on the salon.
The amount of rent, the lease costs for the equipment you have installed, the ideal salary you want to pay your staff, and the compensation you want to secure for yourself.
These factors significantly change the sales per labor hour you should aim for. There is no need to compare yourself with anyone else. What is important is to align with "you and your salon's ideals."
Now, let's actually calculate your salon's "ideal sales per labor hour."
The monthly calculation formula is as follows.
* "Ideal total working hours" are calculated as follows.
* The 1.2 multiplier in the numerator is a coefficient to provide a buffer, taking into account company profits and future investments (store repairs, purchase of new tools, seminar participation fees, etc.).
Let's simulate using an actual salon as an example
[Case A: Sole Proprietor Management]
Ideal salary (my take-home pay + social insurance, etc.): 350,000 yen
Expenses (rent, utilities, consumables like shampoo, advertising costs, all included): 150,000 yen
Ideal working hours: 8 hours per day, 20 days per month (taking a full 2 days off per week)
<Total working hours = 8 x 20 x 1 = 160 hours>
The calculation formula in this case is as follows.
In other words, if you can generate 3,750 yen in sales per hour, you can maintain two days off per week while paying yourself your ideal salary and keeping the salon healthy.
[Case B: Owner and 2 staff members, a total of 3 people (Staff-employed salon)]
Ideal salary (Owner 400,000 yen + Staff A 250,000 yen + Staff B 250,000 yen = Total 900,000 yen)
Expenses (rent, utilities, recruitment costs, system usage fees, etc., all included): 400,000 yen
Ideal working hours: 8 hours per day, 20 days per month, 3-person system
<Total working hours = 8 x 20 x 3 = 480 hours>
The calculation formula in this case is as follows.
For this salon, achieving sales per labor hour of approximately 3,250 yen per hour is the "promised number" for everyone to continue working happily.
What do you think?
When you calculate it like this, don't you feel like "I think I can do this too" or "The goal I should aim for has become clearly visible"?
Don't just stop at knowing. The "4 steps" to improve sales per labor hour
Once you have found your target figures, it is finally time to put them into practice.
To improve your sales per labor hour and lead your salon business to success, you need to follow these four steps in order.
Step 1: Understand the current situation
Start by finding out what your salon's current sales per labor hour is.
Divide last month's "total sales" by the "total labor hours" actually worked by all staff (including yourself, and including overtime).
How big is the gap compared to your ideal figure? Accurately grasping this is the starting point for everything.
Step 2: Set goals
Using the formula introduced earlier, set the "ideal sales per labor hour" that your salon truly aims to achieve.
It is also recommended to take steps, such as "let's clear this level first," rather than setting goals that are too high and detached from reality.
Step 3: Devise and implement countermeasures
Think of concrete actions to bridge the gap between your current situation and your goals.
There are only two main approaches to increasing sales per labor hour.
1. Increase "sales" per hour
Price increases
Increasing unit prices (proposing high-value-added options, reviewing courses)
Improving operating rates by encouraging repeat bookings, etc.
2. Reduce "wasted time" spent generating sales
Streamlining tasks other than grooming (appointment management, chart creation, cash register closing, sales aggregation)
Speeding up handovers and communication between staff, etc.
In particular, the second point, "reducing wasted time," is a highly effective measure that can be implemented immediately without draining the groomers' energy.
Step 4: Track progress
Once you have implemented the measures, track how your sales per labor hour change every week and every month.
"Because we focused on proposing options, our sales per labor hour went up by 200 yen this week!"
"Because we made appointment reception smoother, overtime hours decreased and the numbers improved!"
Once you start feeling the changes in the numbers like this, running a salon becomes increasingly fun.
The reason I recommend digitalization is not just for "efficiency"
The biggest hurdle in tracking sales per labor hour is the "hassle of daily calculation and management."
"I'm already busy every day, I can't be bothered to aggregate labor hours and divide sales...!"
I think many people feel that way. Grasping and improving sales per labor hour is the biggest key to escaping a busy salon management lifestyle. For that, the power of digitalization is indispensable.
For example, if you use CHOKIP
Staff working hours and sales data are automatically linked on the system.
"Sales per labor hour" is automatically measured in real-time and can be checked at a glance from the dashboard at any time.
In this way, digitalization has great significance not only in improving operational efficiency but also in easily and accurately grasping the figures necessary for steering sound management.
Conclusion: Aiming for a relaxed salon management where everyone can smile
"Success" in grooming salon management is not just about increasing sales.
It is about you, the owner, truly enjoying your work.
It is about the staff who work with you taking pride in their work, earning sufficient salaries and taking time off, and shining brightly.
And it is about customers and their beloved dogs returning home with smiles, truly satisfied after receiving heartfelt, careful grooming from relaxed groomers.
I believe that this state where "everyone's happiness" is in harmony is true success.
The first step to building that foundation is to grasp your "sales per labor hour" and tune up the health of your salon. So that the salon you cherish becomes an even more wonderful and relaxed place than it is now.
We at CHOKIP will continue to fully support the challenges of salon owners!
Thank you for reading to the end.
If you found this article even slightly helpful or relatable, it would encourage me if you could press the "Like" button!
<CHOKIP Representative Sakuma Profile>
Joined P&G Marketing Division in 1992. After leaving, established Colors Co., Ltd. in July 2000, which conducts pet-related businesses, and has operated 6 grooming salons for 20 years, as well as launching online mail-order businesses. In 2013, became Vice Chairman of the Japan Pet Salon Association. In October 2022, established DAY ONE Co., Ltd., which provides DX/OMO support for retail & service industries. Develops and operates "CHOKIP," an electronic medical record system for grooming salons.
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