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At one time the veterinarian considering the addition of pet grooming did so with the intention to build a larger business, and to provide more convenient services to clients, and to increase gross revenue. Today, the latter has become most important. Ancillary services are key to veterinary clinics in an effort to boost revenue to pay for expensive medical equipment.

Do your homework for your business! Are you ready to do a business plan for your new department? You can be sure one will be required if you seek a business loan or investor for the project. It's no small task but perhaps the most important task to protect your investment in your business. Below you will find a sales forecast for a grooming department looking to eventually employ 2 groomers and 2 bathers.

Chart generated by Pet Grooming Business Plan Helper & Sampler, a Grooming Business in a Box® product.
Copyright 2007 Find A Groomer Inc. All rights reserved

You need to project your business sales income for 3 to 5 years in advance from the day you open for business (see graph above). Then you need to project the cost of goods sold and operating expenses and deduct them from your projected sales income thereby giving you an estimate of what personal income you can expect to earn from your business (see graph below). Going into business in the dark without knowing what you can expect to earn in sales and personal income is an unacceptable risks to banks or investors, and for good reason.

Chart generated by Pet Grooming Business Plan Helper & Sampler, a Grooming Business in a Box® product.
Copyright 2007 Find A Groomer Inc. All rights reserved

How much do you need to invest? That's another question that must be answered with financial planning. Some grooming departments are simple to build out while others plan to be large and require substantial leasehold improvements.

The graph below shows the start-up funding required for a standard grooming department being added to a vet clinic (similar costs for a boarding facility or retail pet store) in commercial building requiring little renovation. The owner projects requirements as approximately $24,000 in "start-up assets" and $2,500 for start-up expenses. Every business owner learns basic financial terms and you definitely need to know the difference between an "asset" and "expense." In accounting and tax reporting your assets and expenses are handled quite differently. Suffice to say that assets for a salon is major equipment like high-end grooming tables, tubs and dryers. In this example there is also inventory and furniture. If you use the services of plumbers, electricians and other contractors they might be considered leasehold asset improvements. You must get asset vs. expense determinations from a reliable certified public accountant to avoid problems with tax agencies. Certainly the start-up expenses are easier to understand. They have a short lifetime and include grooming supplies, small tools and equipment, advertising, stationery, licenses, fees to name just a few.

Refer to the chart below once more. We know that the owner needed $26,500 to cover the purchases of assets and expenses. The chart tells us that the owner doesn't plan to seek any amount through loans (light yellow) and instead plans to make a personal investment (light blue) in the amount of $26,500.

Remember if you need a loan or investor they are going to want to know exactly how much of an investment you need and how much you are personally putting up of your own money. Don't proceed without knowing the numbers, and have them well-documented. You are certain to be asked for that documentation. If you don't have it you will be perceived as being naive about the conduct required to start-up a business. It's okay to be naive now, but start learning more today.

Chart generated by Pet Grooming Business Plan Helper & Sampler, a Grooming Business in a Box® product.
Copyright 2007 Find A Groomer Inc. All rights reserved

There's another very common question someone is likely to ask you if you seek a loan. Again, don't venture into business seeking loans or investors without knowing your projected "breakeven point." Below you will find the breakeven table for the owner adding a grooming department.

Table (above) generated by Pet Grooming Business Plan Helper & Sampler, a Grooming Business in a Box® product.
Copyright 2007 Find A Groomer Inc. All rights reserved

Do you understand the table information? It's not too hard to figure it out once you know your projected average service fee for grooming services you expect in your business, and what your fixed costs are. Fixed costs can include interest payments on your loans to start-up the business, supplies, rent and utilities, etc. In the example above the department owner knows the business requires $3,725 a month to meet its fixed costs of operation. Because the average grooming is projected at $32.55 it was easy to divide that number into the fixed costs of $3,725. The result is 108; the department must sell 108 grooming services a month to meet the required bills. You will impress others if you can share your department's break-even point, and think about this question. Isn't it easy to count the number of pets you groom or serve as you work through a month? Sure. Knowing that you must achieve 108 units to meet break-even is an easy way to track your progress at any time during the month. You will be better prepared should you not meet your goal, or to celebrate when you exceed your goal and start boosting your profit.

There's no simpler way to write a professional department plan suitable to present to banks than with Pet Grooming Business Plan Helper & Sampler. In fact, one of the sample plans is a complete one-person to staffed grooming business achieved by one of our clients. No one else has ever released similar information and tools customized to the needs of pet groomers. Take a look at Grooming Business in a Box®.

Talk with Other Grooming Business Owners

We suggest you come to the GroomerTALK Message Board and talk with grooming business owners and those operating departments. You are also most welcome to register on the Message Board and start some discussions, ask for help and make friends with others. Better yet, how about sharing your experiences with grooming in order to help others. That's what PetGroomer.com is about, opening up lines of communication between groomers that is still so sorely missing from our industry.
 

Additional Material from our Salon Grooming Pages

The owner of a grooming department needs to learn about grooming management. There are similarities in managing any small business, but never think that managing a grooming operation is overly similar to managing a pet care service operation. You need an acute understanding of managing a profitable grooming department, or it probably won't be profitable. Unlike retail, veterinary and boarding, pet grooming is far more labor intensive. Your biggest expense is the grooming staff of one or more. We're specialists in training cost-efficiency in pet grooming without resorting to lowering quality or humane pet care. It's rare knowledge; the odds that your employees or the groomers in your area have our level of knowledge so be prepared to say to yourself one day while scratching your head, "Everybody seems to have their own way of managing costs in grooming; which way is right?" Since most of the people advising you such as groomers cannot provide you with the financial formulas, and most often only opinions, work the numbers yourself. Never rely on opinion, even ours, work the numbers while maintaining quality and humane pet care. However, we can give you the professional tools to do so, and to back our opinions, using Grooming Business in a Box®.

The balance of the material below will assist you with grooming department management. We again remind you to study grooming management and some of the best leads are in the pet retail trade magazines listed here. Our calendar as well as those in the trade magazines will lead you to trade shows to find the latest in equipment and tools, however, we suggest staying an extra day or two at these shows and take seminars in grooming management from pet industry pros. Consider offering your groomers the opportunity for continuing education in the art of grooming.

Take a look at these surveys. We have many more in our Survey section too.

Is Every New Customer Potentially Worth $25,000 in New Business?

by Madeline Bright Ogle, PhD & Stephen, Webmaster for PetGroomer.com
© Find A Groomer, Inc. 1997-2006 All Rights Reserved

Just how important are client relations services compared to quality pet care services? Is it possible that they are equally important?

Yes, they are equally important. In fact, we believe it takes both superior pet care and superior client relations to earn the $25,000+ potential grooming fees income from each pet owner client. Did you say to yourself, "Wait a minute, what do they mean $25,000+ in grooming fees income from one pet owner?"

It is not the $25 or $35 service fee that you are earning today that is of prime importance (we are using very conservative figures here). A new customer turned into a loyal pet owner client is likely to use your services an average of 6 to 9 times a year. If your average service fee is $30, today’s new customer offers the potential for you to earn up to $270 in the next year. Multiply this by your average client service life expectancy (let’s assume it’s 8 years) and today’s new customer is now potentially worth $2,160. We’re not done yet. The majority of pet owner consumers are strongly affected by pet groomer referrals from pet professionals such as veterinarians, and friends and relatives using pet grooming services. It is not unusual to earn at least 5 to 10 referrals from any one pet owner over their service life with your place of business. If the new customer lives up to the goal to bring you 10 new customer referrals, that’s possibly another $2,160 for each of them over their average client service life expectancy period, or up to $21,600. No, it doesn’t stop here either. Each of these 10 referrals also will eventually could bring you 5 to 10 more referrals, and those referrals more referrals, etc. Each of today’s new customers is conceivably the source for $25,000 to $50,000 worth of business in the next ten years. This is the essence of the Madson Client Relations Program now used in whole or part in hundreds of pet grooming salons. When you value the long term worth of each new customer and regular client, you will serve them with a wide array of client services and dedicated attention (trained manager and receptionists). You place an equal importance on both client services and pet care services because you know for every service you have two clients, the pet and their owner. You do this to gain the maximum number of potential referrals from your area and to maximize your client base. This is the mind set of a business person that grooms.

Ensure that you, and your staff, look at every client as a source of dozens of appointments in the years to come, and as a potential GOLDMINE of referrals in the years ahead also. At your next staff meeting, explain how one customer can mean up to $25,000 or more in potential income. We’ve done it, and it made a difference in our staff’s performance.

In the same manner, you and your staff should understand that a poor client relations disposition and poor pet care services can result in unresolved customer service problems leading to a "lost client". The client that disappears is just as likely to spread their complaint as well as their compliments not resolved properly that leads to a lost client can turn into many lost clients.

It is not as likely for one "lost client" to result in $25,000+ in lost grooming fees income, but $2,000+ or thereabouts is very likely within a long term valuation.

Legendary pet grooming business owners share the attitude that clients relations is a priority. If your goal is not for some reason to develop such a business, you certainly want stability in order to ensure a stable source of income. Now that you know how much client relations impacts the finances of your business, perhaps you can ensure your stable income by going the extra mile for the pet owner as their pet.

Where there is attention given to customer service, there is a more pleasant work environment. Pet grooming involves the potential for great amounts of stress, and there’s nothing better than the pleasure of listening to satisfied clients and new customers to make the work day more pleasing and rewarding.

We are most proud of the Madson Client Program presented in From Problems to Profits. It is truly a benchmark strategy to excel at customer service in the pet care industry. It is of course one of the most important elements of The Madson Management System for Pet Grooming Businesses, and as that attribute implies, client relations is a priority for management. Your role as owner-manager or hired manager is to consistently supervise the content and execution of your client relations program. In this issue, we are adding enhancements to the Client Relations Program as published in From Problems to Profits and as such it’s time to further review the role of management for client relations.

In the years since we first published the original edition of From Problems to Profits we have worked with hundreds of pet grooming business owners. The most troubled business owner in terms of fulfilling management duties are the one-person operations. There are thousands of these type of pet grooming operations in the United States. Quite often their client relations suffers far more than their pet grooming which is almost always very good to excellent. However, if you are the owner -manager - groomer - receptionist all in one you probably know what it is like to be bathing a pet and have the phone ring. Fortunately many one-person operations use an answering machine to cover such instances. This remedy is only a patch. New customers are not as likely to wait for you to call back as your regular clients. To some degree, you are losing new business.

The one person operation has little time to deliver all of the potent client relations practices that we introduced in From Problems to Profits and that we adding to here. It can be difficult to find even 10 to 15 minutes to dedicate to the new customer, especially without the interruption of a telephone call or another pet owner coming in. It may not seem like you are losing money because thousands of businesses run just this way make the weekly earnings they need to survive. But there’s the key, they are in survival. Getting out of survival is to add client relations staff. Perhaps you will add a part-time receptionist in the morning, or one in the afternoon. Some high school students with training and guidance in a business like appearance make excellent afternoon receptionists.

When we suggest this first step the first response is "I can’t afford a receptionist." That may be true for a few of the thousands of one-person pet grooming operations in serious financial hardship, but that’s it. The hired receptionist MAKES you money and easily pays their way when you have an organized system like Madson’s Client Relations Program. In fact, just one small feature of the Program alone will pay for a receptionist. Want proof? See page 12 of this issue [Fall Issue of The Madson Pet Reporter]. Madson’s Preferred Client Program will contribute to the expense of a receptionist. What you get in return is the time to groom better, and a growing professional reputation by having a receptionist deliver the fruit of your Client Relations Program to clients that want to be appreciated and served as well as their pets. In fact, your opportunity to serve pet owner clients is the key to your strategy to stay in business in a world where more veterinarians, retail and super retail stores are adding pet grooming. Of course, your fine grooming bonds loyal clients but you can never take them for granted because you are simply serving their pets and not going the extra mile to make your business more friendly and convenient to the needs of the pet owner.

Today’s world is more harried than ever and pet owners not only want more customer services, they need them and at a point they start demanding them. Client relations staff is truly the foundation for the stability of your business as well as excellence in pet care services.

People love to talk about their pets, and you can’t always do that and groom pets. Sure you can place your grooming table near the entry area, but you are losing productivity so there must be a limit. Your trained receptionist is there for those pet owners that want to share stories, address concerns, buy more products because the receptionist knew how to sell your products, or enroll in profit boosting programs that increase the number of appointments. Your client relations staff makes you look good too. It’s one thing to be an award-winning pet groomer and a business owner, but the addition of staff says you are also the successful business person that grooms. Now we’re on the road to the small business "mind set" that knows there are many roles to being a groomer and a business person, and finds a way in stages to fulfill the duties and responsibilities to each role.

It not unusual for our office to be contacted by pet grooming business owners that regret they never created a business with staff. Why? Well they grew to a point where they were working full-time and long hours, and couldn’t make any more money without increasing prices or cutting back. They had no staff working for them to increase their net income from the business. They also suffered more stress by having to own, groom, manage and customer serve. For some their bodies simply wore out, if not there well-being.

The time comes for every new pet grooming business to add staff, and pet grooming staff is not always the most logical addition. It makes sense to add a pet bather, and then another master trimmer or better yet, first an assistant pet trimmer. It also makes sense to first add a client relations staff to create a growing demand for these pet groomers under your management.

Pet owners want to be served as well as their pet. We’ve covered that topic in From Problems to Profits in 1990 and again here. Since then the industry has shown that pet owner consumers do want convenience and a good percentage are being attracted to grooming departments a part of one-stop convenience stores, or even in the veterinarian clinics. We foresee no turnaround in that trend either, and that is why you should carefully read the material in this issue pertaining to how your priority for pet owner client services can overcome the competition today and tomorrow. Many of our readers have done it, but there are thousands of operations still at risk today.

Actually, we have made it easy for you to fulfill your role in client relations. The Madson Management System has been proven for 36 years now, and you have its Client Relations Program organized

and ready to go. As stated earlier, even adding the Option B appointment scheduling feature within the Preferred Client Program is likely to alone start paying for a part or full time receptionist almost immediately.

Your role as manager of your client relations program is to ensure that you first even offer client services (as opposed to pet care services), and to develop a complete menu of client services equal to your complete menu of pet care services. Really. If not, are you saying that the pet is more important than the pet owner? Ironically there are pet groomers out there that unintentionally infer by their words, actions and client services that they are doing a favor for pet owners. Instead of educating pet owners as a in how to better care for their pets as a client service, they instead scold and gossip about these pet owners behind their back. After 40 years in the industry we’ve surely know of pet owners that don’t take adequate care of their pets, but that was our opportunity to do what do best, see the potential to earn a loyal client who became such through our interest in helping them to better care for their pet. We never judged them for a moment, and instead judge the situation and let loose our superior client services through trained receptionist and manager staff. We exceed their expectations and instead of creating a human drama focused on the poor pet care heretofore provided by the pet owner, we carefully explained the options available that would resolve the pet’s condition and provide it with comfort and yet meet the pet owner’s demand for a pleasing appearance as well. We then almost surely enrolled them in the convenient Option B appointment scheduling plan and we had a budding responsible pet owner in terms of pet grooming needs.

Your role as manager in client relations is to win the business favor of everyone by knowing that your target market is an entire cross section of your community. With 60% of the households in the U.S. owning a cat or dog, what type of person wouldn’t possibly come through your door. The common ground is the pet and pet ownership. How does your business serve the common ground of the pet owning community besides grooming their pets?

Walk yourself mentally through your operation. Imagine if you were being given the full board of the Madson Client Relations Program. In stages, every pet grooming business can if they will take the first step to hire and train receptionists.

Go further than our Client Relations Program. Always look for ways you can improve and encourage and reward suggestions from your client relations staff. As you develop them put them in writing so future staff can come up-to-date with your system quickly. If you can’t think of a solution, brainstorm it with your staff of one or twenty. Perhaps you can ask your better clients for their opinions or another pet care professional associate. Call us. Find A Groomer, Inc. offers telephone management consultation and there are few challenges we have not faced ourselves, or resolved working with our pet grooming business owner clients. We’re here to help.