In running any business three of the most important items are client retention, employee retention and retail sales per client.

 Client retention is most important because they generate a higher return on every dollar spent getting them in the door. It is important to offer them great service to keep them coming back as most of your clientele will be return customers.

 Employee retention is crucial as the customer is more likely to develop a bond with their service provider than with the business or the brand. If your provider leaves, the customer is most likely to leave with them unless you provide a system to retain this client.

 Retail dollars per client is often overlooked and comes from two sources: services and retail product sales. Organizations should devote a certain amount of footage for product sales as they can see a return of 20% sales from products and 80% from services.

 The Commission Concern

 A commission-business is where service providers share their take with the house, and is slowly going away.

 First businesses owners get taxed on the tips their providers make—meaning that owners are effectively paying taxes on income they never received. Second, many talented providers would rather have cash in hand today than to wait two weeks for their paychecks.

 These trends have given rise to one of the biggest concerns to established organizations: booth or space rentals. In this model, providers rent chairs or booths from the business owner instead of sharing those commissions. That way, they get to pocket their cash from customers right away (and the business owner avoids paying taxes on phantom income).

 This is bad news for traditional business who boast neither a compelling location nor a big name to lure talented providers.

 Hard numbers are hard to find, but by all accounts, the booth-rental trend is gaining steam. The Professional Beauty Association says 19% of all beauty establishments now use this model as well as other organization types.