Wage Options for Salon Employees

Owners started dropping their commission rates in order to stay profitable.

Service providers were insulted to be offered less. It’s not that they're not worth every penny, but costs have outstripped the 50% left to the owner. We have seen an exodus of service providers as they move to booth/chair rent in an attempt to retain their commissions.

"The fact is this: for every dollar that you spend on expenses you must generate three dollars in revenues!"

It is easy math to see that 50% commission is going to send you into the red right from the start. Your only saving grace here is to have a smoking retail revenue stream!

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Here are your wage options:

Commission based pay structure.

For example, if a service is worth $100 and your costs are $10, you pay commission on $90. This would still be a tier system and a provider’s income growth would be from the increasing prices as they climb the ladder. If your revenues for month are $30,000, your commissions paid out should be around $10,000.

Hourly wages plus commission.

Chair/Booth Rent.

Remuneration is different in every province, state, and country, so please make sure that you clarify expectations with your local bureaucracy. We have seen some harsh fines from government because the owner was not in compliance with employment expectations. The obvious downside to being a landlord is that your income is capped by the amount of rent you receive.

That’s it in a nutshell! We don’t have a crystal ball, but we CAN tell you that change is inevitable!