We will soon experience one of the great things about Team Based Pay. Next month I will be giving out raises. We have met our salon goals and I have a cash flow plan, so I know we can afford to commit to the higher pay rates. The team has worked hard to reach this point and I'm happy to be able to reward them.
Now the good part - we will be rewarding the most deserving team members! Raises will be based on merit, not on sales. Here's what I mean...
On May 1 we raised some of our prices. Our 1-hr massage price went up $5. If we were still a commission salon, that would have meant instant raise to my massage therapists. One of those therapists has been with us about 3 months. When a therapist is just out of school we give them more recovery time between services than our usual time standards. Three months later, she still requires extra long rest time between services. We also have massage enhancements that may be added to any massage. They cost $15 - $20 and are a great way to get average ticket up. She has been trained on all the enhancements, but is still not competent enough with them that we can add them to her service menu. Now, this woman is a great massage therapist and a nice person--but she doesn't deserve a raise. She needs to be performing ALL our services within our time standards.
On the other hand, I have an Esthetician who has been with us one year. We are a men's salon and when we hired her we really didn't have a skincare practice. She's very good, but still runs only about 50% productivity. When she is not scheduled to do a service, she is behind the front desk helping the salon coordinators. She is one of the best we have for getting clients to pre-book. She is always helpful, never idle. This girl deserves a raise - not because her service sales are great - we're still building that business. She deserves a raise because she makes so many great contributions to the success of our salon.
If my esthetician was paid on commission do you think she would be as eager to help out behind the desk? After all, she would only be getting paid for the time she was doing a service. Team Based Pay allows me to reward the most deserving people. I will be rewarding the behaviors I want repeated.