Diploma of Salon Management cheat sheet

A business plan's core sections are: concept and services, market analysis, operations plan, marketing plan, financial projections, and risk assessment.

Daily capacity = number of service providers × productive hours per day; forecast revenue = capacity × average ticket × utilisation rate.

Utilisation rate = booked service hours ÷ available service hours; retail and admin time are excluded from the numerator.

Break-even clients per month = fixed costs ÷ (average ticket − variable cost per client).

A written standard operating procedure (SOP) must state the task, the responsible role, the frequency, and the acceptable standard.

Peak-demand staffing rule: schedule at least 60% of providers during the hours that generate the top third of weekly bookings.

A salon's service mix should be reviewed quarterly; any service below 10% of revenue and below average margin is a candidate for removal.

Contingency planning requires a named deputy for every key role and a documented plan for loss of premises, power, or a key supplier.

Gross profit = revenue − cost of services sold; gross margin % = gross profit ÷ revenue × 100.

Net profit = gross profit − operating expenses; a healthy salon net margin benchmark is typically 8–15% of turnover.

Cost of sales for a service includes product consumed, provider wage attributable to the service, and commission.

A budget is built bottom-up: projected client counts × average ticket for revenue, then fixed and variable costs by line.

Cash flow differs from profit: deposits, gift card sales, and supplier credit terms shift cash timing without changing profit.

Wage cost should typically sit between 35% and 50% of total revenue; product cost of services typically 8–12%.

Variance analysis: variance % = (actual − budget) ÷ budget × 100; investigate any line beyond ±10%.

Gift cards and prepaid packages are liabilities until redeemed and must be tracked separately from earned revenue.

The employment cycle covers recruitment, induction, probation, performance review, development, and exit; each stage needs documented records.

A structured interview uses the same core questions and a scored rating scale for every candidate to reduce bias.

SMART goals for staff must be specific, measurable, achievable, relevant, and time-bound, with a review date recorded.

Progressive discipline sequence: verbal warning, written warning, final written warning, then termination, each documented and witnessed.

Delegation rule: delegate the outcome and the deadline, retain accountability, and confirm understanding by asking the person to restate the task.

Staff turnover rate = leavers in period ÷ average headcount × 100; track it monthly against a target.

Feedback should be behaviour-based: describe the observed behaviour, its impact, and the required change, rather than labelling the person.

The service gap model compares client expectation with perceived delivery; quality problems arise from gaps in standards, delivery, or communication.

A consultation record should capture hair and skin history, prior chemical services, allergies, desired outcome, and the agreed plan.

Complaint handling sequence: listen fully, acknowledge, investigate, offer a remedy within policy, record, and follow up.

Client satisfaction should be measured with a short post-service survey; net promoter score = % promoters − % detractors.

Retention rate = (clients at end of period − new clients) ÷ clients at start × 100; a falling rate signals a service or value gap.

Service standards must be observable: greeting script, consultation duration, refreshment offer, and farewell are all measurable touchpoints.

Client records must be accurate, current, and stored securely; access limited to staff who need them for service delivery.

Brand positioning statement format: for [target client], [brand] is the [category] that [differentiator] because [reason to believe].

Marketing return on investment = (revenue attributable to campaign − campaign cost) ÷ campaign cost × 100.

Retail attachment rate = retail units sold ÷ services delivered; a common target is 0.5–1.0 units per service.

Promotion mechanics must state the offer, the eligibility condition, the expiry date, and the redemption limit in writing.

The marketing mix for a salon comprises product, price, place, promotion, people, process, and physical evidence.

Local search and review profiles are primary acquisition channels; review volume and recency affect visibility in map results.

Discounting reduces margin directly: a 20% discount on a 40% margin service removes half the gross profit.

Hand hygiene before and after every client, and after removing gloves, is the single most effective cross-infection control.

Single-use items (files, buffers, applicators) must be discarded after one client; reusable tools must be cleaned then disinfected or sterilised.

Disinfection requires cleaning first: organic matter inactivates most disinfectants, so cleaning precedes chemical disinfection.

A colour-coded cleaning system separates washroom, floor, and surface cloths to prevent cross-contamination.

Material safety data sheets (SDS) must be available for every hazardous product on site, and staff must know where they are kept.

Sharps and blood-contaminated waste go into labelled, puncture-resistant containers and are removed under a licensed waste contract.

A first aid kit must be stocked, in date, and its contents checked on a recorded schedule; incident reports are completed for every injury.

A patch test for oxidative hair colour is normally required 48 hours before first application, and the result must be recorded in the client record.

Informed consent requires the client to be told the risks, alternatives, and likely outcome before treatment, and to agree voluntarily.

Client data must be collected for a stated purpose, kept only as long as needed, and disclosed only on a lawful basis.

Employment records, including hours, pay, and leave, must be kept for the statutory minimum period in the applicable jurisdiction.

Public liability and professional indemnity insurance protect against claims for injury and negligent treatment respectively.

Minors below the statutory age of consent require a parent or guardian's written consent for chemical or invasive services.

Price displays, service menus, and promotional offers must be accurate and must state any compulsory additional charges.

Par level = safety stock + (average daily usage × lead time in days); reorder when stock reaches the par level.

Stock turnover = cost of goods sold ÷ average inventory value; higher turnover with no stockouts indicates efficient control.

FIFO (first in, first out) rotation is mandatory for professional products with expiry dates; new stock goes behind old stock.

Back-bar product is consumed in service and is a cost of sales; front-of-house retail stock is an asset held for resale.

A stocktake variance above 2–3% of inventory value warrants investigation for shrinkage, mis-issue, or record error.

Products must be stored per the label: temperature range, away from light, and never decanted into unlabelled containers.

Supplier selection criteria include lead time, minimum order, return policy, training support, and price per unit of use.

Continuing professional development should be logged with date, activity, provider, hours, and the competency it maintains.

Skill gap analysis compares the competencies required by the service menu against the verified competencies of the team.

Trend adoption decision rule: pilot a new service with a small client group, measure demand and margin, then decide on full rollout.

Technique obsolescence risk is highest where a service depends on a single product line or a single trained individual.

Sustainable salon practice includes refill and bulk purchasing, correct dilution, recycling of packaging, and reduced water use.

Industry trends to monitor include online booking and client self-service, clean and vegan formulation demand, and flexible pricing models.

Mentoring and peer teaching raise retention: staff with a documented development plan show measurably lower turnover.