Love your videos bro, question tho, I'm opening up a 3 chair shop in michigan, and I had someone approach me about wanting to invest... what should I do when I know nothing about investing... thank you g
thanks Mario! Whenever you are approached by an investor, think beyond the monetary value. Ask yourself, how will this person help the business grow, is this an investor who will be involved on the day to day of the business or is this someone who is just trying to build their portfolio? Is this investor going to help finance other locations as well, how long of a business relationship will this be? To be honest, if you are a barber and you plan on working at this 3 chair shop, in a booth rental model most revenue the business will make is around $10k/mo if you're not behind the chair cutting then it's going to be around $3k/mo. If you have a commission model the business will more likely to cap out around 27k/mo, which is around 10k after percentage. With you behind the chair you're more likely to make 12-15k/mo after percentage depending on your clientele. Then you have to decide how much you're okay with splitting with that investor. (and I didn't even factor expenses in those numbers) I think the first thing you need to ask yourself really is, do you 'need' an investor, and whether or not they're coming in as a business partner and will help finance future locations. Weigh the pros and cons, and go from there. - Mike
The booth rental model doesn’t work, every shop I know that do booth rental always is short. While commission u as the owner controls the growth of the barbers and shop. Now there is a difference between commission cash pay and payroll shop. The way things are going the booth rental model will start going away. A lot of this has to do with taxes. Commission shops are more successful in more public locations like shopping centers.
This was great.
Love your videos bro, question tho, I'm opening up a 3 chair shop in michigan, and I had someone approach me about wanting to invest... what should I do when I know nothing about investing... thank you g
thanks Mario! Whenever you are approached by an investor, think beyond the monetary value. Ask yourself, how will this person help the business grow, is this an investor who will be involved on the day to day of the business or is this someone who is just trying to build their portfolio? Is this investor going to help finance other locations as well, how long of a business relationship will this be?
To be honest, if you are a barber and you plan on working at this 3 chair shop, in a booth rental model most revenue the business will make is around $10k/mo if you're not behind the chair cutting then it's going to be around $3k/mo.
If you have a commission model the business will more likely to cap out around 27k/mo, which is around 10k after percentage. With you behind the chair you're more likely to make 12-15k/mo after percentage depending on your clientele.
Then you have to decide how much you're okay with splitting with that investor. (and I didn't even factor expenses in those numbers)
I think the first thing you need to ask yourself really is, do you 'need' an investor, and whether or not they're coming in as a business partner and will help finance future locations. Weigh the pros and cons, and go from there.
- Mike
In a commission shop, are the barbers W2 employees or 1099?
W2
The booth rental model doesn’t work, every shop I know that do booth rental always is short. While commission u as the owner controls the growth of the barbers and shop. Now there is a difference between commission cash pay and payroll shop. The way things are going the booth rental model will start going away. A lot of this has to do with taxes. Commission shops are more successful in more public locations like shopping centers.
You are 100% right all successful. Barber shops we worked with are a commission base shop.
I have a booth rental Barbershop but I want to turn it into a commission barber shop nd step by step instructions any Recommendations
A lot more headaches. You have to worry about stealing etc, health insurance, taxes...