Financial Control

Open Banking | from 14.09.19

What is Open Banking?

New EU standards come into place from 14 September 2019 and will affect your business bank account(s).

Called “Open Banking”, it means you can choose to share your bank account information securely and electronically with anyone else. It is designed to encourage competition in the banking industry, giving you more choice, as well as greater control of your data and how it’s used. Every business will be affected differently depending on the bank they are with.

How might it affect Salonfrog’s clients?

The new rules will change the way some banks connect to Xero (the accounting platform all our Clients use).

To comply with the new requirements, many of Xero’s bank feeds (i.e. where we currently take a read-only feed from your bank account) will be replaced by new direct feeds using Open Banking.

We may be required to update your existing bank feed to a new direct feed, so that your transactions continue to flow into Xero each day.

We’ll let you know about any changes we need to make as and when. In the meantime, let us know any questions you have.

The e-myth

This short video brilliantly covers 5 really key points on running your salon as a business.

Working on your salon as well as in it, is a key recurring theme here – whether or not you want to expand!

https://professionalbeauty.co.uk/site/pbtvdetails/what-to-know-before-expanding-your-salon-into-a-chain

We’ve been pushing this concept with our Clients for a long time and can also highly recommend a book which Salonfrog follows to the ‘t’:

https://www.amazon.co.uk/Myth-Revisited-Small-Businesses-About/dp/0887307280/ref=asc_df_0887307280

Performance Report & KPI’s

We look here at the start to controlling your Salon/Barbershop by showing how you can measure your business goals using key performance indicators – KPI’s.

https://tinyurl.com/y2bxhs5z

Performance Report & KPI’s

Performance Report | a stand-back overview on how your Salon is performing

KPI’s | key performance indicators – measuring the key goals of your Salon

Background

To keep control over your business, you need to know where you want it to go, and then make sure it’s going that way. As the British artist The Streets says:

“If you don’t know where you’re going then any road will take you there.”

Day to day, you’ll be stuck in the detail (often being sucked into your bookings system hour by hour) and it’s hard to take time to step back and see the bigger picture. This is where the Performance Report comes in.

Performance Report

The Performance Report is a monthly overview of what’s happened in the month and where your Salon is headed so far year to date. By using it, you get to see a more holistic view.

It revolves around a summary ‘profit and loss account’ (which shows the amount of income generated and from where this income has come from (e.g. from Clients or from Contractors). It also shows key parts of your balance sheet – such as the amount of cash in the Bank, amounts still owed (for example to HMRC or to your employees if the payment run is yet to happen).

Some Salons will have already put together a Budget for the year and the Performance Report will show the actual results against it.

KPI’s

The Performance Report can also include KPI’s which are used as part of a more sophisticated control mechanism, to ensure your Salon is achieving its goals (or at least heading in the right direction). You don’t need many KPI’s but the ones you do have should highlight the most important (say) 5 areas you want to control.

Some KPI’s you will obtain from your Salon Software directly (e.g. Phorest, VendHQ, SalonIQ, GetTimely etc.) which may include:

Other KPI’s you can include in your Performance Report:

*Stats per the NHF (and Salonfrog has seen this sort of range in its own Clients as well.)

Your own KPI’s

You need to consider what’s important to you and your Salon, then decide which KPI’s you want to measure and report.

Motivating Staff

You can use KPI’s to motivate staff and measure their performance. They also come in handy to backup performance ‘issues’ with staff members.

In Summary

Set your goals, put in place a way to report them, then take action if your salon or barbershop is moving away from them.