#32 Profit Margin > Top Line Revenue
You don’t need a million-dollar salon.
You need a profitable one.
Because $1M in revenue with zero profit is just stress with bigger numbers.
But $400K with 20% margin? That’s strategy. That’s sustainability. That’s you and your team getting paid.
Too many salon owners are chasing a monthly revenue goal that looks good on Instagram but leaves them broke, burned out, and wondering why they just can’t seem to make enough.
Revenue is not the same as money in your bank account.
Just because your books are full doesn’t mean your business is healthy.
You can be “busy” and still broke.
This happened to one of our students who was booked solid, but after we ran the numbers, she was working 50+ hours a week and barely taking home $300. The issue? Her pricing didn’t support her cost of doing business.
Profit is what pays you, funds growth, and gives you choices.
Let’s say your salon makes $600K/year.
If your expenses are $590K, you have $10K leftover. That’s not enough to pay yourself well, reinvest, or rest.
But if your profit margin is 20%, that’s $120K in net income.
That’s a real salary. That’s new team members. That’s a summer vacation with your kids.
It’s not greedy to want more margin, it’s smart.
Profit isn’t about gouging guests or raising prices just because.
It’s about being able to keep promises: to yourself, to your team, to your family.
When you have profit, you can afford better benefits, training, bonuses, and sleep at night.
Want better margins?
Start with these 3 things:
Audit your pricing: Are you charging based on your expenses + target profit?
Look at payroll costs: Is your payroll eating more than 53% of your revenue?
Focus on retail: Retail is a quick way to increase revenue without increasing payroll, and it doesn’t take a lot of time to sell
If you’ve been chasing revenue and still feeling strapped, it’s time to look at the numbers that actually matter.
Salt & Light,
Heather