Washing Profits Down the Drain

May 18, 2016

Losing money

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One of the biggest expenses in our business are shampoos and conditioners to help keep our clientele squeaky clean.  Although we need these valuable products to keep our doors open, there is a common occurrence in many salons that have the business owners scratching their heads in wonderment.  They literally are washing profits down the drain and they don’t know how to stop the madness.

As a shampoo distributor, I see the mismanagement of our ‘liquid gold’ on a daily basis.  Salons that groom 150 dogs a month are buying over $200 of shampoo per month!  That doesn’t make sense!  Salons that do closer to 500 dogs in a month typically spend that much on shampoos.  Why are they going through so much product?  The answer lies in what your team is doing.

Why do we allow our bathers to mismanage the shampoo inventory and wash money down the drain with eat pet?

These are the answers I get:

  • My bathers like more lather.
  • They do not measure and dilute the products properly.
  • We don’t read the labels.
  • We don’t have a system
  • (And my personal favorite) “The bathers don’t care.  It’s not their money.”
Pet shampoo and products have come a long way since the dark age

With better ingredients and processes to make it, we are able to get higher dilution rates per gallon of shampoo.  Higher dilution means you can wash more dogs with one gallon.  More dogs + buying less product = more money for your business.

Break out those calculators and let’s do some math!

(Please note, these numbers are based on averages and may not be exact to the products you currently use).

 If you are diluting your products correctly, the following is how much money you are spending on each diluted gallon you make:

If your shampoo is a X:X, you are paying $$ per diluted gallon:

50:1 = $.70

32:1 = $1.00

16:1 = $1.50

10:1 = $2.50

5:1 = $5.00

1:1 = $25.00

Each gallon contains 128 oz of product.  The higher the dilution, the more pets you can wash per ounce.

Here’s a simplified way of thinking about it – with a 50:1 product, you should be able to wash approximately 100 dogs.  A 10:1 product is closer to 20 dogs.

But I’m buying a 50:1 product but we’re only washing 20 dogs with it!

And this is the heart of the problem.  A 50:1 product is more expensive than a 10:1.  The difference is about $15 more for the gallon of the higher diluted product.  So if your staff is using a more expensive shampoo, designed for more washes, but only washing the same amount of dogs as a lower dilution product then you are losing money!  A LOT OF MONEY!

What’s the Solution?

Trust me when I say, this is a touchy subject.  Our team, especially the Bathers, have a very hard job and to bug them about something that they don’t care about, is difficult. However, any great company knows that if waste is a problem, then it must be stopped.  Every penny can add to the bottom line and more profits equals more money for everyone.

  1. Start with a Budget
    Once you know how much shampoo you buy, how much you spend and how many dogs you can wash per month, you will have a basic budget in place.  For more information on this, check out my article on Budgets.
  2. Get your Bathers Involved

Now you have a budget in place, time to have your team become a part of the buying process.  Offer incentives to them to save money and come in under budget.  Having your staff involved at this level shows them that you trust them with your business.  It also gives them a competitive kick in the butt to help you achieve this goal!  Buy them some hand lotion, let them go home without cleaning the tubs one day, give them a gift certificate for a manicure!  Anything to help you save money on your shampoo purchases!  If they see the waste too and are passionate enough to help you monitor it, then you will save money.

3.  Re-evaluate Your Process
Create a system to dispense shampoo wiser so you are not just washing money down the drain.  The following examples are systems that some clients have in place that help them keep a check on the shampoo being used and ultimately their bottom line:

  • Bathing Systems that have a shampoo dispenser, such as Hydrosurge and Prima.  There are plenty more on the market and I would love to hear which ones you enjoy!
  • Take an empty gallon and fill it with the appropriate dilution.  For example, a 50:1 product will use 2 ounces (a shot glass) per gallon.  Fill the empty jug with the 2 ounces of product and then the rest with water.  Use this pre-mixed gallon to fill up your mixing bottles.  (You can use old milk jugs too).
  • If pouring directly into a mixing bottle, mark a fill line on each mixing bottle and stick with it.

I promise you, once you pay attention to how your shampoo is being used, you will see savings each and every month.  It may seem small but at the end of the year, it will add up.  Don’t let your team dictate how you spend your money.  If it was coming out of their paychecks, I PROMISE YOU, there would be no waste!  They would dilute that stuff to a ‘T.’

Need further convincing?  Real example of a shampoo budget

Company A – okay, it’s my company!  Million Dollar Dog does over 650 dogs per month. Before I got my shampoo in check, I was paying $275/month for my products.  At the end of the year, I spent $3,300 for shampoos.

We implemented two plans.  The first was buying higher dilution products and the second was the empty gallon plan!  Taking the proper dilution of each product, filling it up into an empty jug and then using this for filling out mixing bottles. My new shampoo spending dropped to $233/month totaling $2,796 at the end of the year!  I saved $504.

What have you done to save money in shampoo?  Please leave some comments below.  Is your shampoo budget out of control?  No problem!  Contact me and we can look at it.

Continued Success,

Tara

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