Keeping staff happy and well-compensated should be a top priority for salon and spa owners – giving stylists and providers the opportunity to earn more is critical for staff retention.
However, managing and paying out tips is an ongoing source of stress. Cash tips can be lost or stolen, tracking tip data manually is error-prone, and including tips with paychecks delays the payout to providers.
Here, you’ll find best practices for tip payouts and ways to fend off those problems. You’ll see how using features and automation with Zenoti, the complete software solution for salon or spa management, can improve the entire process at your salon, spa, or medspa.
Implement a clear tipping policy
Explain your tipping policy to employees during the hiring process, and periodically review it to ensure all staff are on the same page.
Tipping policy details include the types and frequency of tip payouts. Some businesses pay out tips in cash on a set schedule, like daily or weekly. This gives service providers fast access to funds, but also leads to cash and administrative overhead for the business. Other businesses pay tip income via payroll and direct deposit, forcing providers to wait for payday to get their tips.
Build trust in your tip management system. Help your service providers understand how the system works, and be open to questions or concerns they may have. Additionally, ask for staff feedback to stay aware of their pain points.
Use software to collect and pay out tips
Make tipping easy for guests and convenient for staff to process. Build tipping into a digital checkout and payment system. Using this method ensures that tips go directly to the service providers who earned them, and eliminates the risk of cash tips getting misplaced, lost, or stolen.
Within the Zenoti software platform, tip percentages displayed to guests can be customized. For example, a salon can preset 15%, 20%, and "custom" as tip options during checkout. The "custom" option gives guests the flexibility to tip as they will, such as 30% for outstanding service or a generous $50 tip on a $100 service to reward a stylist on their birthday.
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Automate tip payouts to ensure timely payment to providers. With Zenoti, providers enjoy faster access to their tips, outside of a business's pay cycles. Tips are paid out within two business days, and automatically deposited into an account the provider can see via the staff mobile app. Faster payouts = happier staff.
Zenoti allows you to create rules for tip distribution, too. Tip payouts from one customer to multiple stylists for a single visit are easy and seamless. Say a guest invoice is $150 ($100 color + $50 cut) and the guest tips 20%. Zenoti automatically allocates $20 to the colorist and $10 to the stylist – no need for math by the front desk or the guest.
Generate reports to track tip payouts
Keep accurate records to safeguard against tip-payout issues like discrepancies and staff complaints. Make data your objective point of truth.
Zenoti reporting features make it easy to track tip payouts, with software doing all the work for you. Slice and dice tip information any way you want – by time period, staff member, center, or your organization as a whole.
Use tip-income data to boost provider motivation and performance.
1. Identify providers earning the highest tips and duplicate their best practices for great service throughout your salon or spa. Give your rock-star providers validation and opportunities to mentor.
2. Offer coaching to providers who want to boost their tip income. Zenoti report data is right there for positive reinforcement as providers improve.
Give service providers control over their performance and their day
Help service providers keep track of their earnings, including tip income. The Zenoti mobile app designed for salon and spa staff is your tool. Staff can view tips earned that day, during the current pay cycle, and more. Here's how that would look in myZen, the staff mobile app.
Empower your service providers to boost their morale and earn their loyalty. By giving your providers faster tip access and daily insights into tip earnings, you’re likely to find happier, more motivated staff and better retention.
If you're more focused on guest satisfaction, be sure to enhance your reputation as a provider-friendly salon or spa, too. Service providers can make or break your brand, so it's just as important to keep them happy.
Conclusion
Managing tip payouts can be a stressful, time-consuming task for salon and spa owners doing it manually.
Zenoti can automate and speed up your tip payouts – you'll prevent problems like lost or stolen tips, delayed gratification for providers, and inaccurate reporting. Business benefits include greater efficiency and low or no cash and administrative overhead. And when your providers are happier, you'll find them more motivated to give great service, leading to happier guests as well.
