A crisis can happen at any moment and for any reason. One moment, happily running a business, managing the everyday challenges, and seemingly out of nowhere unexpected and uncharted waters can arise. A crisis is when there is a significant disruption to the normal balance of running a business. They can range from environmental factors, such as tornadoes and hurricanes, to senseless crime, like mass shootings or terrorist attacks.
Most recently, the COVID-19 crisis impacts everybody – especially the most vulnerable. Stay-at-home orders have been issued nationwide, which directly has an impact on day-to-day operations and includes the added strain due to school closures and travel restrictions. Businesses and lives have been taken out of balance; to borrow a term from biology, we are no longer in homeostasis.
How do skin care professionals as the primary leaders in the spa business identify ways to bring balance back and begin to add value to clients? When a crisis hits there are several ways to react, all of which are valid, but not without consequence. Anger, fear, and feeling paralyzed are all normal reactions to rapid uncontrollable change, but how can we lead through the new environment and ensure that business survives and thrives for years to come? There are five key steps to sustain a business through a crisis.
Just as an emergency room physician will immediately run through a checklist and battery of tests to determine the extent and location of the damage; skin care professionals need to run a checklist to identify what areas of their businesses are suffering.
Firstly, identify the impact of the crisis on the spa. How does it change cashflow? Do expenses go up or down? For example, the stay at home order means the service revenue is zero until clients can be seen again. Knowing this, by averaging out last years’ service revenue per month, the professional will be able to estimate the lost revenue while the stay-at-home orders are in place. If service revenue is zero, what other areas of revenue can potentially increase to offset the loss?
Retail revenue is a great way to help cashflow while services are unavailable or uncertain. How can a professional increase retail revenues? Shipping products, gift-cards, memberships, pre-paid services, and virtual parties are all ways to increase revenue when live services are unavailable. Learning a new skill like virtual consultations is an excellent way to keep in contact with clients, gain new clients, and build revenue.
Once the location and extent of the damage is diagnosed, the next step is to rank which area needs the most attention. For example, personal and employee safety should always be at the top of the list. Once employees are safe, then assign the most hours to tasks that will help solve the problem due to the crisis.
If service revenue has been reduced, then alternative ways to increase revenue have now become the priority. Allocating more hours per day to the tasks that will increase retail revenue should be the priority. Naturally, prioritize these activities to tasks like doing laundry at the spa because this task is not directly related to the spa’s most important need – cashflow. The triage step should only take a few hours and once completed, document the ranked priorities and come up with a plan.
This is the least attractive step, but vital. By documenting priorities, it gives the professional a way through the crisis. It allows the professional and their business to have hope and record their challenges. It gives a sense of empowerment because there is now direction. When a crisis hits, the roadmap is taken away and replaced with confusion and fear. A professional’s plans gives them a compass that can navigate the days ahead.
Now is also a great time to update policy and procedures. Some spas may currently have old ways of doing things that are no longer relevant. For example, “I only do consultations in person.” This is a great policy when a professional can see clients, but if this is no longer an option, maybe it is time to revisit some old policies. When updating a policy, make sure to document it and use it as a roadmap for a future crisis.
Executing a plan is where the real work begins and is the crucial step between success and failure. The planning process allows identification of which tasks need to be completed and by whom. Identifying deliverables and by what dates are the keys to execution. Once the dates and deliverables are established, this allows the spa to hold team members and themselves self-accountable.
Example: “I’m going to call 10 clients per day to see if they would like to try my new virtual consultation and receive a complimentary gift for trying my new service.” Each day set aside time to call each client and carve out the time on the calendar for those future consultations. Once 10 clients were called, the daily objective has been achieved; if not accomplished, then identify the gaps during the next step.
In a crisis, regular activities are taken out of balance. By implementing the five steps above, professionals are taking back control, but are the activities they are doing effective? Are spa owners treating the areas of the business diagnosed as most important or did they possibly miss something?
If reduced revenue was the prognosis then after a couple weeks, the spa owner will see that their retail revenues are maintaining or increasing due to the actions taken above. If not, are there other things to be done that could help accomplish the goals identified in step one? This needs to be done weekly to see if anything new needs to be diagnosed.
Crises are not new and there will be more. And, while no one can predict when and how they will occur, by following the five steps above professionals will be better prepared to serve their clients and sustain their businesses for years to come