Salon Today - February 2009 - (Page 26)

Where’s My As the saying goes, “You can’t take it with you.” But what exactly will you do with your salon in the end, and how can you best prepare for its eventual sale? I n March 1998, Shannon Jenkins launched the four-station salon Hair Xtreme outside of Richmond, Virginia. But from day one, Shannon says she envisioned the salon’s eventual sale. Although the commission-based salon attracted some strong talent from the start, Shannon realized within 18 months that the current business wasn’t moving her closer to her hopes and goals. She attended a Strategies Incubator advanced management education session where, “I got excited about our potential and embraced the teambased business model. The business took off from there,” she remembers. Within a few years her husband Daryl came on board to help with the business. We grew and moved into a bigger location with eight stations, an area to add spa services and a bigger retail space.” Within a few years, the business was doing well, showing a healthy profit. Shannon and Daryl had established all their management systems and Shannon stepped out from behind the chair. “We started thinking about what was next— should we launch a second location or do something entirely different? Should we keep the salon as a source of income, or should we sell it?” she remembers. But as Daryl is fond of saying, “The deﬁnition of luck is where preparation and opportunity intersect.” A stylist, who had been with the salon for seven years and was serving as the manager, approached the couple and asked if they ever thought about selling the business. Shannon soon entered into negotiations and in October 2006, Hair Xtreme had a new owner. According to Neil Ducoff, CEO of Strategies, the Jenkins’ case is a rare one, and by creating a ﬁnancially solid, systems-based business, the couple did indeed make their own luck by establishing a business that was attractive to a buyer. “Unfortunately, the more likely scenario is a stylist opens a salon because he or she loves the technical side of the business and lives and breathes to do hair,” says Ducoff. “These owners can post some impressive numbers, but too often they don’t take the time to understand these numbers, pay attention to the balance sheet or the proﬁt and loss statement. When it comes time to exit out of the business, the realization hits that they really needed to have spent more time working on the business.” No matter how wildly successful your salon business is, there will come a day when you’re ready to step away from it—hopefully either into a comfortable retirement or into another lucrative opportunity. The time to start planning for that transition— and boosting the sales value of your business—is now. 26 | February 2009 www.salontoday.com http://www.salontoday.com

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Salon Today - February 2009 Contents Editor's Note Reception Spa Menu Decor Inside Look Custom Color Board Games Where's My Exit? Products Owner to Owner

Salon Today - February 2009

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