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Case Studies

A leading beauty salon achieves revenue growth of up to 130% by rejuvenating the performance of its staff

March 27, 2023 | No related items found.

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BACKGROUND

The beauty industry in the Asia Pacific region has seen significant growth over the past decade, partly driven by the increasing demand from middle-class consumers. As the middle class continues to grow in many countries in the Asia Pacific region, there is a corresponding increase in disposable income, which is driving demand for beauty products.

E‑commerce has also become an increasingly important distribution channel for beauty products in the Asia Pacific region. Online sales have continued to grow as more consumers in the region become comfortable with buying products online — and in some case make it their primary mode of shopping.

Our client is a leading beauty salon based in Hong Kong and Asia, offering professional treatments as well as related beauty services. They are positioned at the high-end of the beauty industry that is dedicated to providing beauty and wellness services to customers.

THE CHALLENGE

As a result of a planned rejuvenation and merger of two brands within the client’s operations, they recognised new opportunities in improving revenue through the better use of management control systems (MCS). We were invited to help the client implement a more robust MCS, as well develop better dashboards and KPIs for its business.

ANALYSIS

An initial two-week analysis in the client’s branches across Singapore and Hong Kong revealed areas for revenue improvement, cost management, and operational improvement opportunities. From here, we embarked on a 25-week engagement with the objectives of driving revenue generation, as well as optimising marketing spend and payroll cost management. The project was structured into four key focus areas: 

CALL CENTRE OPERATIONS

  • Analyse call centre capacity and operational improvement 

CENTRE
OPERATIONS

  • Operational improvement, standardisation, and revenue generation across Singapore and Hong Kong

PERFORMANCE MANAGAMENT

  • Review current performance management practices 
  • Introduce standard practices 
  • Encourage employee participation in generating ideas 

MARKETING EFFECTIVENESS

  • Analyse current marketing spend across Singapore and Hong Kong 
  • Increase visibility on marketing spend and enable decision-making on new marketing campaigns 

Project Implementation

The project started with the selection and training of a taskforce comprising of three staff members from the client’s side, supported by a full-time team of our consultants. We trained and coached the task force in its methodologies, including behavioural change techniques and strategies. We also oversaw the project to ensure the committed deliverables were achieved.

To achieve maximum impact and buy-in, a joint client-Renoir team reviewed results of the individual focus areas during weekly Management Action Team (MAT) meetings, whilst a joint client-Renoir steering committee met every two weeks to provide direction, make key decisions, and ensure the project was on-track to deliver results.

This approach allowed for a direct engagement with stakeholders, which in turn improved ownership and buy-in from the client.

Results

The project introduced several initiatives directed at improving revenue, optimising marketing spend, and standardising operations across Singapore and Hong Kong.

After 25 weeks, the following results were achieved.

FINANCIAL
RESULTS

Singapore
• 25% increase in revenue
• 44% increase in product sales
• 46% increase in sales to new customers

Hong Kong
• 11% increase in revenue
• 130% increase in product sales
• 9% increase in sales to new customers

OPERATIONAL
RESULTS

Singapore
• 181% increase in no. of potential customers contacted
• 14% increase in no. of call centre bookings

Hong Kong
• 123% increase in new leads
• 20% increase in no. of new customers

Additionally, the original commitment of a 2:1 ROI return was surpassed with a final ROI of more than 3:1.

CONCLUSION

The improvements in performance management, call centre operations, and the standardisation of processes across the centres made a major contribution to the benefits.

Since then, the implemented initiatives have provided clearer work processes and improved accountability, data analytics, and operational management.

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