Your Numbers Don't Lie (Even When You Do)

Salon profit numbers can tell you if your business is truly thriving or just surviving. In this episode, you’ll learn how to use simple, real numbers to boost your salon’s success and make smarter decisions. KEY TAKEAWAYS Track Net Profit Margin Check your net profit margin every quarter. Divide your total profit after all costs by your total revenue, then multiply by 100. Aim for at least 10%, and 15%–20% is even better. If it’s below 5%, you’re working for free. Measure Revenue Per Client Look at your average bill per client. Divide total income by number of visits. For hair salons, this should be higher than a simple cut and finish. If it’s not, you’re not charging enough or not upselling well. Check Client Retention Rate Compare your client list from January this year to January last year. Aim for at least 70% retention. If it’s below 50%, clients are leaving fast. Below 60% means it’s time to act. Review Utilisation Rate Use your salon software to see how much of your booked time is filled with paying clients. Target 85%–90%. Below 70% means you’re wasting time and space. Above 90% means you’re booked solid—maybe time to raise prices. Review Numbers Quarterly Don’t check daily or monthly. Look at profit, revenue per client, retention, and utilisation every three months. This helps spot trends and fix problems before they grow. Stop blaming slow weeks—use the numbers. Fix Low Profit with Price or Costs If your profit margin is under 10%, don’t just work harder. Either raise prices or cut costs. Reinvest profits to grow your business, not keep it stuck in low margins. Use Two Numbers Together If your utilisation is high but profit is low, your prices are too low. If utilisation is low, you’re losing clients or not marketing well. Use both numbers together to find the real issue. CONCLUSION Knowing your salon profit numbers gives you power to grow, not just survive. Let Phil Jackson’s calm, clear focus guide your choices—just like in a winning team. Find more tools and tips at buildyoursalon.com.