AboutDoug Staneart Expertise Doug Staneart can answer questions about gaining cooperation from, motivating, and influencing coworkers and employers. He is also an expert on how to avoid and resolve conflicts as well as other issues dealing with long term business relationships.
Experience
Doug Staneart has been a speaker and trainer for over ten years specializing in public speaking, leadership training, and team building. Doug is CEO of The Leader?s Institute® (Team Building) and BuildingYourTeam.com based in Dallas and author of the books 40 Ways to Influence People and Fearless Presentations. He has accumulated over 2700 hours of classroom coaching and training and began his career with Dale Carnegie Training® where he was recognized on numerous occasions for superior instruction.
Expert: Doug Staneart Date: 4/6/2008 Subject: Busines Problem
Question ok the problem is that my parents have owned a particular beauty salon for over 13 years. their was a time when my parents would make alot of profits from it, Because the business itself makes alot of money. But then they started increasing their employees salaries until they realized that they did not have enough money to pay the bills. Now they are thinking about selling the salon because, their are too many employees (which arent needed) and the employees that work their are making too much because of the increased salaries thought the years. One problem is that they are afraid of firing the employees they don't need, due to the fact that they are extremely hard to deal with.What is the right thing to do in this situation?
Answer Andres,
Unfortunately, the only thing to do is either increase the revenue coming in or let some people go. If your parents don't do one or both of these things, then everyone working there will lose their job and your parents will lose their livelihood all in one moment.
What most business owners fail to take into account when they begin increasing salaries, is the cost of the TOTAL overhead of the business. They usually factor in things like rent, electricity, and advertising, but forget things like replacement of equipment, credit card fees (the 2-4% that Visa and Mastercard charge you when your customers pay with a credit card,) bank charges, payroll taxes, etc.
It is very easy to get to a place where everyone is making money but the business owners. If your parents are in this situation, they will want to do a couple of things. First, go to the bookstore and buy an accounting book like Accounting for Dummies and read it. Second, hire an accountant to look over the books. The best thing that they will get from this is that the accountant will ask questions that get them think differently about the business and to keep better records.
Ultimately, they will have to let some people go. Tell them to be up front with everyone and let them know what is going on. They might get a few of them to leave on their own.
