Profit – what profit?
There’s little point in having a business if it doesn’t make a profit. Profit is the reward for having your own business, as it gives you the lifestyle you want and deserve from putting up with all the stress. However, sometimes you have to accept you won’t make a profit every year and this could be one of those years. If that’s the case for you, accept it and focus on how the numbers will work going forward, as that’s what will give you your future profit. It will also help you to offset against this year’s losses.
Reforecast your numbers for the next phase
It’s crucial to reforecast your figures and check that everything adds up in the medium term as otherwise you will just be getting yourself into debt.
Negotiate with your landlord
The Government Code of Practice for Commercial Landlords sets out how landlords should be trying to help businesses during the pandemic. Use this as a basis to negotiate points like rent-free periods, reduced rent or to agree on a new lease on more favourable terms. With many shops starting to become empty, landlords will be increasingly keen to keep a viable tenant, albeit at a lower rent. Have a good look at your lease and see what powers you might have.
Cut out any non-essential costs
This means you need to be brutal when it comes to cost savings. Anything that isn’t absolutely essential for the running of your business needs to be cut. Only you can decide what you think is essential as this will be unique to every business. If it can’t be cut completely – can it be cut back?
Use relevant government support
There are many different types of government support schemes available which are changing all the time. Make sure you keep abreast of the changes and take advantage of any new support offered. You may have resisted taking a Bounce Back or Coronavirus Business Interruption Loan so far, but depending on your forecasts, it might be the right thing to get you through the next difficult phase.
Review and manage your client conversations
Strategies brought in to manage the first lockdown and first post-lockdown rush now need to be adjusted to manage the next phase. Many salons switched off their promotions and some automated email and texts to remind clients to book in on their cycle. Consider reintroducing these messages ahead of Christmas. Similarly, look at what messages your team are delivering to clients to ensure they match. Ask the team if their conversations are creating opportunities or reinforcing doom and gloom?
Design a new vision to suit changing habits
It’s hard to see the future at the moment but people are willing to support those who try. Salon owners who can offer a vision to suit a client’s new wants and needs will come out stronger.
Ryan Fox is a consultant for the hair and beauty industry. If you would like to fi nd out how Ryan could help you and your business go to umbrellaconsulting.co.uk.