At Visible Changes, beauty parlors have become a fast-growth business.
Nobody who goes into hairdressing sees it as the business it really can be. Until they see this."
"This" is Visible Changes Inc. -- the largest, fastest-growing haircutting chain in any city in the country -- and the man leading the tour of this bustling, neon-and-ceramic-tile beauty salon is its president and co-founder, John McCormack. Since its start in 1977, Visible Changes has grown to 15 locations in Houston and Austin, Tex., with expected 1985 revenues of $12 million.
McCormack himself is a relatively new convert to the idea of hairdressing as a growth business. Eight years ago, as an ex-New York City cop-turned-stockbroker, he was looking for a business to run when he took up with Maryanne Warren, a hairdresser who is now his wife and business partner. She saw money to be made in a streamlined approach to haircutting that she had developed. McCormack agreed.
They wanted to start a "haircutting company," and their business plan called for a chain of high-volume, no-appointment hair salons located in indoor shopping malls -- a new twist at the time. The McCormacks hoped then, as they do today, to take the chain national. What they didn't figure on, however, was the lukewarm reception they got from bankers and mall developers, who considered beauty salons high-turnover, low-margin propositions. While the McCormacks eventually secured the necessary financing and leases, it took all the persuasive power they could muster: "They thought we were going to be just another bunch of yo-yo hairdressers."
John McCormack knew from the beginning that if Visible Changes salons were to grow and multiply, he would have to find ways of assuring quality control, while building managerial bench strength.To him, that meant the development of a strong employee-training program, as well as compensation and promotion policies that encourage and reward achievement. But the real challenge was how to accomplish that in an industry in which most of those in the labor pool are "young, relatively uneducated, and thanks to salaries in this business that average $7,000 a year, almost totally lacking in self-esteem."
The salaries that the McCormacks dangle beneath employees' noses are uncommonly high, stretching into the $30,000 to $60,000 range for managers and assistant managers. Their profit-sharing plan is worth $3 million. And the cream of the employee crop gets a change to manage million-dollar salons. None of these career-ladder carrots is simply there for the picking, however. Training starts weeks before recruits go to work, and it continues, in weekly installments, long after they are "on the floor." Raises, hikes in commission, bonuses, and promotions all depend on the employees' ability to get customers in and out of the chair in half an hour or less, and to maintain a good request rate -- the frequency with which customers ask for them by name.
But, as much as the McCormacks like to grant management responsibility early, they have learned the hard way that training and achievement alone do not a manager make. They have had to fire one manager, along with half of that salon's staff, for condoning the use of marijuana. Others, unable to cope with the stresses of the job -- or, in the case of some female managers, uncomfortable with making more money than their spouses or boyfriends -- have asked to step down. Now, instead of promoting at age 23, McCormack is holding off until perhaps age 27. He is also mixing the managerial ranks with experienced outside hires.
"A manager is what makes or breaks the salon," McCormack says -- and, he might have added, the company. To continue Visible Changes's record of solid, sensible growth -- the kind that McCormack wants to see a little more of before he ventures beyond Texas borders -- he needs to be able to lean all the more heavily on the people he promotes. After all, he shrugs, "this is a business."