There is this illusion that once you get fully booked, then you hire a warm body to come in there and help with your overflow. And eventually, someday, out in the future, you might be able to work less and still have the business be making money. When it comes to hiring a team member, there are questions that I get asked consistently- many of those come from lash business owners who have already hired team members and are now discovering steps that they may not have been aware of or just didn’t know would be an issue prior to hiring.
So I want to address the five things that you should know before hiring your first team member so that you are setting yourself, your team member and your business up for success.
1). Business Finances
If you do not know the basics of reading a profit and loss statement AND you do not know if you are profitable or how profitable you are in your business – THEN IT IS NOT TIME TO HIRE. If you struggle to pay yourself, if you have never taken the time to understand even just the basics of accounting and bookkeeping – it is not the time to become financially responsible for another human being’s livelihood.
2). Laws + Regulations
One of the very first guests I had on the podcast back in 2018 was Paul + Tussanee Luebbers of Lashcast Podcast and Tussanee said the most accurate truth I’ve ever heard for salon owners wanting to build out a team. She said it jokingly but it was 100% facts and has lived in my head rent free ever since then. She said,
“Just because you don’t know the laws – doesn’t mean they don’t apply to you” 🤭 DAAAMMMNNN.
Cause look – I’m going to make a statement right here that’s going to confuse and challenge A LOT OF YOU. Chances are you are 100% unaware that it’s illegal- and I’m speaking specifically to those of you in the US – 1099s or independent contractors are an ILLEGAL misclassification of employees for salons in the way that MOST salons run their businesses. I’m going to do a follow up epsiode on this next week to explain more as to why, but I can assure you – just because you were hired as a 1099 right out of beauty school (and just because every salon in your area uses 1099s ) DOES NOT MEAN IT’S LEGAL.
THAT’S HOW LITTLE SALON OWNERS ARE AWARE OF THE LAWS – which is why Tussanee’s statement still makes me laugh cause I use it weekly with my students and inside of the DMs y’all send me. I’ll elaborate more next week – but it is YOUR DUTY as the business owner to be compliant with the laws of your county/state/province/ country/etc.
3). Go To Pros
You should have and hopefully be utilizing the following professionals AT A MINIMUM in your business BEFORE hiring your first team member. An accountant and an attorney. Now I know your first thought – yeah maybe someday when I’ve got more clients or maybe if I had a team generating 6 figures for me – then I’ll get an accountant or talk to a lawyer. NO! An accountant SHOULD be saving you more money by way of write offs and helping you understand the financial health of your business more than they cost you.
A GOOD accountant is going to help you give you ideas and strategies to help make the good numbers in your business bigger and the not so good numbers in your business smaller. A GOOD accountant is there to support the health and growth of your business. Now sure, there’s plenty of really shitty accountants out there – out of the 5 accountants I’ve had in my journey as a business owner – 4 were really shitty – like unbelievably shitty. And I didn’t know it until AFTER they filed taxes and I reflect back on the advice they had given me. It took me going through 4 accountants to finally find one that advises me and teaches me quarterly on more in depth info about tax savings strategy and growth strategies for my business.
You don’t necessarily need someone like that right away. When you’re just starting out, you need someone competent in service based businesses AND someone you feel comfortable asking questions to that isn’t going to make you feel like you’re an idiot or asking what they may think is a dumb question. The vast majority of you have never taken an accounting course – so find someone who is willing to teach you what you need to know to make wise financial decisions.
As far as attorney’s go, you don’t need to keep one on retainer. You should look for a contract attorney to create or review your contracts when you’re just starting out – like your policies, your release of liability and/or consent forms, and your website’s terms and conditions and privacy policy at a minimum. Once you’re ready to hire you should have that attorney draft up your employment contract and have them advise you on non-compete and non-solicitation clauses so that your new team member’s don’t go stealing the clientele you’ve built for them.
Keep in mind – those two clauses are generally only enforceable for employee-employer relationships and are not typically valid for independent contractors even if it’s in a contract. I am not an attorney or an accountant, so be sure to check with a licensed pro about the laws and regulations in your jurisdiction. You’ll also want to form your business into an LLC at a minimum if you haven’t prior to bringing on your first team member and an attorney or an accountant can help you do that.
Now additional pros you may want to consider when you’re ready to build out your team – an HR consultant so YOU are not the one who has to stay on top of every employment law change and updated regulation. An HR consultant can help you stay compliant. You probably also want to consider a Bookkeeper service so that you are not the one managing all of the transactions of the business because as your business grows – so will the number of transactions that happen in your business both with money coming in and money going out.
And possibly a business coach or mentor to help you stay focused on the goals and avoid costly FOMO or Shiny object syndrome. Someone to help you get clarity on what goals you’re working towards and how to reach those goals sooner/faster/better/easier, and to help you stay accountable to follow through with your plans so that you actually have the business you want instead of constantly adding more work to your plate and never seeing the rewards of your efforts.
4). What hiring a team is – and what hiring a team is NOT
While I don’t believe there is a single person in this world who doesn’t want to work less and make more – let me be clear – hiring a team is anything BUT that for a long time. Sure, it is possible to eventually work your way out of your business where 100% of the operations and growth of the business no longer depends on your involvement, but there are very very few businesses across any industry that ever actually achieve that. The majority of salons and spas are run in ways that the owner never fully becomes “absentee” because too much of the owner’s ego and self worth is tied up in the results of the business.
So while you may be a fully booked solo artist – please do not mistake whatever your level of success or demand as a solo artist will translate smoothly to having a team of lash artists working under you. If it was so easy and the norm was making more and working less – everybody would be doing it.
I can tell you this right now – the most common struggle I hear from salon owners in the $100k-$300k range is… you ready for it – paying themselves!
Meaning their business is generating anywhere from $8,000-$20,000 A MONTH and the owner is not paying themselves. Sounds ridiculous right? Yet it is SO common. The owner is desperate to get support as a solo artist cause they’re overworked and constantly turning away clients. So they put out a job post and get someone – doesn’t matter who – in the door asap to help with the client load. They don’t look into their business’s financial ability to be able to support another team member and they don’t understand the laws and expenses associated with legally hiring a team member. They just blindly throw a wage at a team member of 50% commission and start booking them clients with hardly any training or guidance.
The owner then struggles to get their clients to move over to the new artist because “nobody does lashes like you” and even new clients want the best of the best and not some new artist. So now – the owner is still overworked with little to no margin for training the new team member, and is slowly sending new clients to the new team member. But because they don’t have a plan in place for this team member to grow and thrive, the team member sits around all day on their phone waiting for a client to come in so they can get some form of payment – yet they see the owner taking back to back clients all day long.
It only takes a few weeks of this pattern to happen for a team member to realize there’s no growth potential for them and that the owner doesn’t care about their success or failure as a member of the team – so they leave and the owner is back at square one again with every penny coming into the business going back into the business and the owner struggling to pay themselves. This scenario happens ALL the time – ALL the time. It’s why I know it so well because I hear it ALL the time. Building out a team is an incredible privilege and responsibility. It can be an insanely rewarding journey but I promise you it is a JOURNEY – NOT a destination. You think handling crazy clients is a sucky part of your job as a solo provider – imagine dealing with crazy clients AND unstable team members who have authority issues.
Building a team in my business has been and still is the most challenging, heart wrenching and gratifying part of my business. It sucks and it’s awesome. In some ways, it’s a lot like parenting, because you get a new team member – who’s totally moldable and has incredible potential and if you train, lead, and manage them well -they will thrive and you’ll change your business AND their life. If you do not train, lead, and manage them well – it will tank your business, your other team members, and make you question daily if you’re cut out for this life. Building out a team means your business is no longer centered or dependent on YOU – meaning YOU are no longer your business – your business is now a BRAND that is separate from you – and that is incredibly scary for those of you who’s self worth is tied up in your business and your business is your baby. Which is a limiting belief that-you’re the “only one who cares about your business” and can give your clients the results they want. If that’s more important to you than the success of the business and the success of your team – then you’re not ready to build out a team.
5). Get in the habit of paying yourself consistently NOW – put yourself on Payroll
I want you to work on paying yourself NOW before you hire your first team member. Even if it’s just $50/week to start- it’s the BEHAVIOR of paying yourself that you need to master – not some revenue number you need to reach. Put yourself on payroll and figure out what payroll company you want to use so when you’re ready to hire on your first team member – you have already been in the practice of consistently running payroll and managing your money better with yourself . That way adding on a team member will be less overwhelming when it comes to paying them.
If building out a team is something that you really want to do we have our momentum mastermind applications opening up again at the end of May. That is a six month group coaching program for those that want to build out teams legally and profitably and we’re gonna have a whole lot more conversation around what that is in the coming weeks. You can get on the waitlist for it by going to www.thelashpreneur.com/mastermind and that way you’ll be notified when we open up applications.
My Go-to Beauty Industry Accounting Experts: @smallbusinesscpa @thebeautycpa
Give Gusto a try!
LOL Podcast Episode: Is 6 Figures Realistic as a Solo Beauty Business Owner- Listen HERE
