ETS Tanning Bed Blog

It may sound cold, but you must evaluate every employee in your tanning business as a profit center.

Look at it this way, if you hire an employee to work 40 hours a week and you give them a basic salary of $8 per hour, then you’re paying out $320 a week, not including the additional expense of taxes, insurance and paperwork.

In turn, you should be asking yourself “how much profit does this employee bring in?” The cold, hard truth of the matter is that when it comes down to it, every employee should be evaluated by how much profit and how much revenue they’re bringing in.

How to Evaluate Employees

When you evaluate your employees’ performance, you want to look at more than just their total revenue, but also their profitability. An employee may be selling piles of stuff, but if it’s all low-end lotions and your basic tanning packages, then the profitability just isn’t there.

Some salon owners are quick to assume the employee is lame and begin counting the days until their poor choice moves on. Is that the type of owner you really want to be? If you are taking time from your busy schedule to read this post, I think not!

So, what can you do immediately once you realize an employee just isn’t profitable?

Turning a Money-Losing Employee into a Profitable Employee

If a sales person isn’t profitable, you typically have three options:

• Move that employee to a busier time – It may not be the employee's fault. Maybe he/she has great close ratios and scores a few tanning bed upgrades during each shift, but just isn’t seeing enough customers to hit the sales levels you want to see. Consider moving them to a busier time and give them an opportunity to close more sales.

• Expand on their training – Maybe an employee hasn’t received solid tanning salon training or perhaps they aren’t even aware of all the possible upgrades and add-ons. If this is the case, then the onus is on you or another senior employee to get them that training.

• Terminate the relationship – Finally, if the employee has the training and the opportunity of being in the salon at peak times and they’re still not doing well, you may have to think about terminating the relationship. It’s a hard decision, but you have to ask yourself if you can really afford to have an employee that’s simply not profitable? Whatever you do, don’t let them linger. You will both be better off for making the tough decision and acting on it appropriately.

Ideally, you want to help all of your employees achieve their highest potential. But sometimes, you need to balance that attitude with the cold hard facts.

What have been your experiences with low-profit or non-performing employees? Were you able to turn the situation around? What did you do to improve their profitability? Please share your success stories in the comments because I’d love to hear them. trong>