The salon I'm working in has asked for my private label products for their retail area. This, I can do.

Instead of having them buy my products wholesale, I want to give them a split of the retail sale figure each time a sale is made, cumulative at the end of the month.

(I am paying for the use of the room only when someone is booked, rather than a monthly fee/rent.) so - the RISK is split......and I want to compensate the owners for that kind of 'edge.'

I've taken the figures to buy the products, added shipping and handling - created a profit margin and come up with a retail price for each product.

This salon will have my products on the shelves 5 days/week - I am there only 2 days/week. Sales can be processed 5 days/week.

In a nutshell - I am 'shelf-renting' and paying to have receptionist (sales) assistance in my absence.

Considering the retail amount of the product - what percentage split do you think would be fair? I have a spreadsheet prepared and know what I would want if I were the salon owner......but am interested in what others have as input.

Thanks!

Karen

Hi Karen,

I believe a fair split on this would be in the neighborhood of 25% for the salon. They'll have no $$$ invested in the product (though you will) and the money they receive will be gravy. You may have had a smaller cut in mind but, certainly, don't pay more. Good luck!

PS: now that those products are branded they no longer are private label. A brand is a brand and a brand is precisely what you own. The private label distinction ends once a product is assigned an identity. Very important to know this!

Ditto on the 25% figure.
If they want to do the tracking, there's even enough for them to pay 10% commission to staff.
Strongly suggest you don't do that tracking (headache.) But they can!

OK, you two - I must have been a mind reader......I set it up as 25% to the salon, 75% to me.

I figured what I would want if I were a salon owner with a business-concept renter, who was exceptionally organized.

I manage stock and sales - they provide shelf space, accessibility, and adminstrative tasks such as paying sales tax, etc.

Thank you!

Karen



Douglas:

You are right - they are MY PRODUCTS - no longer 'private label.'

Now, when my husband retires in 3 years and we move to the beach........I need to keep my products in this salon and find a new shelf spot there.......

And other places too Karen! Sky's the limit. :-)

That's because you're one savvy businesswoman!

Thanks for the topic. I, too, am renting space from a salon 2 days per week (more as I get busier) and was wondering how to go about doing this. THANK YOU!!![size=7]

Let us know how it goes for you Dennis!