Star Performer Could Cost You Your Business


Article Posted on 10/09/2019


It's true!  Paying too much to get that Star Performer could ruin your successful business.  I know it's hard.  You struggle to keep good people and the chairs full.  You think the answer to your prayers has just walked in the door when a Rockstar Stylist comes in and says they will bring their entire book with them.  There's a problem though.  They want to be paid 60% commission.  Well why is this a problem you ask?  Let's think of this from your other employees' perspective.  Is it fair that they get paid more?  Why are they more valuable than those that have been showing up every day up to now?  Now, let's think about it from a financial perspective.  Let's just run through an example quick.  $100 ticket - less back bar, commission, payroll tax on the commission and tip, merchant fees.  You probably have about $20-25 left and have all those fixed expenses to pay like advertising, benefits & training, rent, front desk, utilities, etc.  I can almost guarantee you are not making money.  Do this too many times and all of a sudden you don't have a business at all.  Don't promise the moon without running the numbers.  Be a Business Person First!

Kopsa Otte
  • kopsa otte CPAs & Advisors
  • 306 East Seventh Street
  • York, NE 68467
  • 1-402-362-6636