Case study: How not to run a Great Clips hair cut joint

My Disastrous Hair Cut at Great Clips – and how their information systems contributed – a Case Study

Plus, suggestions for any business on how this should have been handled

Sections
As I have learned more about the business of hair cutting this has probably expanded to my longest ever post!

• Synopsis
• Background
• Where Things Went Wrong
• Update (things learned after writing the above)
• About the Hair Cutting Franchise Market (This is probably the most interesting part – the industry is basically a scam that preys upon young women – almost all workers are female – pays minimum wage, no benefits, and they must provide their own hair cutting tools after completing 1,000 to 2,100 hour licensing programs. Most franchise chain stores are owned by passive investors – its a cash flow generator. Owners make a lot of money while staff pay is on par with fast food restaurant workers.)

Synopsis

Went to Great Clips for a hair cut. Big mistake! My hair is always a few inches long and cut back, at most, to the top of my ears. Great Clips stylists refer to their Clip Notes database to supposedly read notes on my prior haircuts there – but unknown to me she is reading the notes for a different client. Without warning, she runs a razor along the side of my head, cutting my hair which is 2+ inches in length to 4 mm or 1/6th of an inch in length. I tell her “What?” and she proceeds to say that this is what the computer says while whacking off the other side of my head. Shortly after she has literally shaved the sides and back of my head in a crude attempt to balance her butchering job, another stylist tells her she is reading the notes for “Nick” who was a no show and is giving me the wrong haircut. At this point, she rushes me out with a hair cut looking like a Nazi.

How on earth could an organization be this incompetent? That is the subject to this case study and based on my research and observations I will never go to a chain hair cutting place again. They really are that bad.

Background

Companies often add information systems – because they can – without thinking through possible failure scenarios and how those impact workers and customers. This is a case study of how a common failure scenario, and a distracted or incompetent stylist abruptly shaved the side of my head – leaving me with a Nazi-style hair cut. Unbelievable. Yes, a semi-Nazi looking hairstyle which will take up to 4 months to recover from.

Great Clips white supremacist/Nazi haircuts are even a meme on social media.

My background is information systems (M.S. in software engineering) and an M.B.A. Doing systems analysis, organizational and information systems architecture is what I did, and this is a classic business case study.

Great Clips is a large chain of franchised hair cutting businesses that typically operate at local retail strip malls.

Their business model is to be the low cost franchiser of hair cuts for men, women and children (versus SuperCuts, a chain which seems to charge a little more and offers more services or versus locally run barber shops and styling salons.)

A few years ago, Great Clips began using a data base to track their customers’ hair cuts. They call this Clip Notes. Stylists made notes in the database to – hopefully – guide the next hair cut (since you probably will not have the same stylist each time).

Separately, Great Clips began offering a smart phone app, and eventually a web app, to enable customers to reserve a time in advance, versus being a walk in customer and having to wait for the next available stylist.

These two data systems, combined, to produce a very undesirable outcome!

I was a walk in customer to the local Great Clips. While I have only been to this store 3 or 4 times (we recently moved) I had gone to Great Clips for 7 years (mostly at my prior address). Because some customers reserved on the app and a couple of other walk-ins were ahead of me, I had to wait a bit – ended up being about 30 minutes.

Where Things Went Wrong

They went to their waiting list and called for “Nick”. But Nick was not in the store (if he was a walk in) or never showed up (if he was reserved). When it was obvious Nick wasn’t there they went to the next name on the list – me. And this is where everything went haywire at Great Clips.

The stylist, unknown to me, was still thinking I was Nick and read the hair cutting notes of Nick – who apparently has a super short military style hair cut. She mentioned something about a 1 1/2″ razor and immediately takes the razor and buzz cuts the side of my head. I said, hey, wait, this doesn’t seem right!

UPDATE: Turns out she said a “1.5 razor” and I interpreted this as “1.5 inch razor” as that is about how wide the razor looked to me. But 1.5 is a razor head guide number denoting a razor that leaves just 4mm long hair on the head – literally an Army buzz cut. How is an ordinary consumer supposed to know what a 1.5 guide number means?

I’ve never seen their Clip Notes entry for me and I know that sometimes the stylist cut my hair using a comb and then running a razor along the comb line to trim a clean cut. I thought she was referring to that. I had no idea that her reference to a 1.5 razor meant she was about to run a buzz cut across the side of my head.

And while I’m telling her this isn’t right, she then does the same thing on the other side of my head.

In matter of less than a minute, this Great Clip’s stylist has obliterated my hair. She realizes at this point that somethings not right and buzz cutting the top of my head is going to make it worse. She tries to balance the look and ends up shaving off the back of my head. I’m now left with shaved sides and back of my head with hair too long for that style, on top. A Nazi haircut. (I later learned that others refer to this on social media as the Great Clips “white supremacists” haircut – that’s nasty.)

About now, a different stylist calls the name of the next person still supposedly on the waiting lit- and calls my name! But I’m already having my hair slaughtered – what?

This other stylist realizes what just happened and tells my stylist that she has the wrong customer and is referring to the hair cutting notes of Nick, not Ed. They just gave me someone else’s haircut. And worse they give me someone else’s lousy haircut – done really badly, and I mean really sloppy and poorly done.

This action by the stylist, surprisingly, appears to qualify as a 4th degree misdemeanor assault in my state. Crazy, huh? But in reality, she will face no repercussions. Great Clips has no quality assurance program nor metrics on stylist customer satisfaction – literally, no accountability.

Broken Business Processes

There are multiple things going wrong at Great Clips:

1. Great Clips lacks a procedure to verify and cross match the computer record with the actual customer. Simply asking the customer for his or her name and cross referencing to the record or reading the name from the record out loud would have spotted the error immediately. This is either a systems analysis failure, a design failure, or a training failure. At this time, they do not have any process/method for verifying the names match. (I have since spoken to a manager and this is true – they don’t have an existing procedure to verify anything.)
   
2. “No shows” are a frequent problem with their scheduling system. Some “walk ins” went to Starbucks to wait – but did not return in time. Some “walk ins” walked out after finding the wait time was longer than they could wait and did not come back. And some of the reserved customers never showed up. This fiasco started the moment Nick did not show up. This led to a cascade of errors starting with the no show, not verifying the customer record, and then applying someone else’s hair cut to a different customer. “No shows” are a catalyst for problems and they appear to have no procedures in place to reduce no shows or how to prevent them from causing additional problems.
   
3. Having not verified the correct customer and data records, the stylist then failed to communicate properly with the customer. The stylist was distracted, not competent or a ditz (a.k.a. scatter brained). Before she touched my hair, she should have confirmed my name with the record. She should have noticed that the description bore no relationship to my existing hair style (which was several inches long). She should have explained clearly what she was about to do and/or ask me specifically how I wanted my hair cut (I was never asked and assumed she had correctly read my prior visit notes). She used terminology that was meaningful to her but not the customer. To illustrate, at past haircuts, the stylist combed out to the edge of my hair and then ran a razor along the comb – not my head. I thought her reference to a razor was to its use along the comb. She has poor communication skills and failed to properly communicate on multiple levels.
   
4. The moment the stylist was aware of the error, the proper customer service oriented response would have been to own it, apologize, say there is no charge and offer to make the next hair cut free. Instead, she rushed through the rest of this, leaving the wrong haircut done badly, with straggling hair in places, rough cuts on both the left and right, and charged me, albeit at a discount. An hour later I saw the mess in the mirror, looked online for what to do about a screwed up haircut and the word was, call or visit them back the same day. It took a phone call and two more trips back to get a refund. Related: When you are a guy and they’ve shaved much of your head there is nothing that can be done to fix it at this point except to live with the embarrassment for a few months.
   
5. They do not seem to collect any metrics. When the stylist messed up, no notation was made anywhere. Even when I went back to the store (twice!) no note was recorded about the stylist’s error. They do not do customer satisfaction surveys – in other words, they have no metrics to evaluate product and service quality. Without metrics, they can never become a better organization! Another way to view this is that there is no quality assurance program and no one is tracking their output.
   
6. A complaint to Great Clips corporate headquarters was responded to with “its the franchisee’s problem, not ours”. This is a common response from franchisers who take no responsibility for their franchisees’ actions. Quality organizations, like Starbucks, manage their franchisees to deliver consistent services throughout all of their franchised stores. But too many franchise operations operate like Great Clips and absolve themselves of responsibility.
   
   A franchiser can either stand behind the franchisees or in this case, hide behind them!
   
   In effect, the Great Clips brand is meaningless because they are not able to deliver consistent quality repeatedly across their foot print. Or, the corollary: the Great Clips brand name means inconsistent hair cuts, every time!
   (See update at end)
   
7. Incredibly, both a friend of mine and my adult son had the exact same experience at other Great Clips! There too they used a different customer’s records and gave my son someone else’s haircut (he has not returned since this happened 3 years ago in Eugene, Oregon). This points to poor management at Great Clips corporate and not adequately placing appropriate processes across their franchisees. This failure scenario for their Clip Notes usage has been going on for years and they’ve done nothing to fix it. Indeed, there’s a long online list of bad experiences at Great Clips.
   
8. Corporate said they would forward my comments to the local store. After a day, I’d heard nothing so I stopped back in the store. Every person working there said they’d never heard the name of the stylist that butchered my hair! I am wondering if the store employs unlicensed stylists? They took my name and number and I did eventually hear back from a supervisor. They refunded my money and offered me a free future haircut. I will not go back of course (See update at end).
   
   The “free haircut” offer expires in 8 weeks – but it will be 4-5 months before my hair has grown out such that this offer is a bit of an insult. They had repeated opportunities to respond in a positive customer service oriented fashion, but instead did the wrong thing at each step. This was when I chose to file a formal complaint with the state licensing office and sent a detailed version of this case study to the office of their CEO. This paragraph is probably the most important one in this case study – they lack a customer service mind set and have no idea how to be a pro-active customer service minded organization.
   
   I posted a short description of what happened, with 1-star reviews on Google, Yelp and Facebook.
   
9. There is a corollary to (8). In the 1980s, business management guru Dr. Tom Peters noted that, back then, businesses only heard from about 1 in 28 dissatisfied customers. The other 27 just never returned – but told 10-12 of their friends, on average, of their experience. Today bad business interactions get shared far more widely. It’s not just a few bad reviews – its what happens when recipients of poor service tell far more friends via social media sharing.
   
10. This disaster had some personal costs, let alone the psychological self image/self esteem issues that many of us deal with. In the aftermath, I canceled out of many events, groups and activities out through the end of November as I do not want to be see at these events looking like this.
    
    ‘Bad haircuts — and I’ve had my fair share of them — can really depress you,” he says. “When you’re walking around like you’re sporting a crooked toupee, like some drunken game show host, you feel totally powerless.” ‘
    
    I’d gone in for this haircut just before a rare all family get together – the result was bad enough that we did not do any group portraits.
    
11. I have revised my own procedure for hair cuts – who knew we need a procedures list for purchasing a hair cut?
    (1) Read reviews; (2) ALWAYS bring a photo of yourself with the correct haircut; (3) if they refer to prior notes, request they read out the name and the description of what they are going to do – do not permit them to touch your hair until they have clearly stated what they will be doing; (4) Don’t assume they have appropriate procedures or competent staff; (5) Take charge of the hair cut – ask them about each tool they are going to use, (6) if at any time something is not right yell (really) “STOP!” and go no further until the problem is understood by the stylists, and (7) write down the full name of the stylist or barber and their license # for future reference, if needed. RELATED: It’s noted that guys do not know much about hair cuts (true for me) and we tend to space out and not pay close attention during our hair cuts. In fact, we need to be focused on the cut as it happens and yell Stop when it goes off the rails.

The list I sent to the CEO’s office has more items but this is enough for you to get the general idea of numerous process failures and customer service mistakes made at every step. I do not expect to hear anything back from Great Clips corporate regarding my many suggestions for fixing their deficiencies. However, quietly behind the scenes they will probably adopt at least a couple of them 🙂

Obviously, I am never going back to Great Clips.

Big Update

I learned it takes up to a week for Corporate to forward customer satisfaction issues to the local franchisee. A week? That says customer satisfaction is not a high priority. They need to fix that. Amazon can ship a product in a day but Great Clips takes a week to electronically send customer feedback to their stores?

After I shared my bad experience with friends on social media, several said never go to Great Clips. As one put it, they are “the worst of the worst”. Ouch. I also found a few people saying “only White people go there” and their haircuts for guys look like “white supremacist” haircuts (true). I searched Instagram for #GreatClips tag and that’s all I found after scanning through hundreds of photos. Double ouch. I had no idea that retail chain hair cutting places had such reputational issues.

Above, I wrote about a “1.5 inch” razor. In doing some research, I learned my interpretation was completely wrong. In fact, when she said “1.5 razor” she was referring to a number that designates a specific razor head size (a number that can vary by razor manufacturer). In fact, the 1.5 razor head is a cutter that cuts the hair to just 4mm in length! When I said she did a buzz cut on me, I was not joking. My hair went from several inches long to 1/6″. The stylist used terminology that was meaningless to the customer and failed to communicate what she was about to do, after reading the wrong notes. Having learned this I feel better about having filed a complaint with the licensing office. She screwed up on multiple levels.

I did hear about a week later from their area district manager and she is apologetic, will be working with the store manager to get more training for staff there, and offered to refer me to a stylist that she regards as excellent (but I will not go again to Great Clips). There were some comments about certain people’s abilities, skill sets and training needs that I will not mention publicly. I believe she recognizes they messed up – I was pretty forceful during our phone conversation, which is the opposite of how I usually deal with things. I hope they will be making some changes but I will be going elsewhere for future haircuts. (See below – I’ve learned more about the franchise hair cutting business and I no longer plan to go to franchised outlets – see below).

Bottom line is they had a series of business process failures – starting with the “no show” problem, then no procedure to ensure they were matching the customer with the customer record, then apparently no process to handle mess ups. As I noted above, the moment they knew they messed up they needed to own it, apologize, immediately say there is no charge and offer the next hair cut on them. They need a system in place to gather metrics when staff make big mistakes and to collect customer satisfaction data. At present they have no metrics and thus, can’t identify failures, learn from them, and develop improved processes.

Great Clips knows their stylists can infuriate their customers. Why else would this be their odd policy “for safety and privacy”:

This ends up – hopefully – as a useful business case study and lesson for other businesses.

About the Hair Cutting Franchise Market

A benefit of being retired is I can choose to learn more about obscure subjects like hair cut franchise models and businesses, if I want to.

The local hair cut chain store franchise is primarily a business pursued by passive investors. That is, they put up the money to set up the business: hair cut places are very low cost – minimal furnishing, low inventory. The owner generally has zero experience in cutting hair – it’s strictly a business investment. It is also a service business that Amazon probably will not squeeze out of the market – and a decent salon will get repeat business from their customers.

From Quora in a Q&A about Great Clips franchise opportunities:

• “They offer a semi-absentee business model
• They are extremely picky about who they award franchises to
• You can grow a multi-unit business
• You don’t need to know anything about cutting hair
• It’s pretty darn recession-proof”

As we will see, the owners make a very good income. The stylists, however, make crap wages, receive no benefits and must provide their own hair cutting tools. The industry is basically a scam that preys upon young women who make up 92% of the work force.

The owner hires a salon manager who hires staff, which are independent contract workers (no benefits) and not employees in the traditional sense. Stylists have to purchase and provide their own hair cutting equipment. The entire business is a scam that preys on mostly young women.

The U.S. has a surplus of licensed staff for working in hair salons so the pay is low ($9-$12/hour is typical). This came about because the government, for a long time, provided scholarship money for students to pursue training in cosmetology, in spite of the markets being saturated with workers.

“A young woman pays thousands and spends about 40 full-time weeks in school to secure the government’s permission to do quick cuts at a strip mall where she earns about $12 an hour.”

The pay is low because the labor market is saturated; some jurisdictions have noticed this. The Great Clips model is designed to largely rip off women.

“It’s a high turnover industry with a bunch of women who are used to not staying in a job very long or being treated very well. In that industry, you have to treat your employees well; I had a jump on that. I’m good with people, and figuring out what their natural skills are. “

https://www.washingtonpost.com/business/on-small-business/business-ownership-on-the-side-franchisees-keeping-their-day-jobs/2012/06/27/gJQAiHuS7V_story.html

It is generally expected that the investor will have sufficient funds to set up multiple store fronts (say, three or more). The business produces cash flow for the investor and the growth opportunity comes in three forms: (1) initially to max out the number of customers per store, (2) to open additional stores, and (3) to sell a successful retail business after it is up and running. A typical start up cost is about $130k to $250k but may net up to half that in income per year (or more) which is a great ROI for a passive investment. Franchisees pay fees back to Great Clips.

Investors may need to open up more local stores to prevent cannibalization of sales from new Great Clips outlets in their neighborhood. If the investor does not do so, Great Clips may sell the right to another local investor whose stores may eat into sales of the existing storefronts. On the flip side, perhaps in smaller markets, Great Clips may prevent competing franchisees from opening, thereby providing a local brand monopoly.

The franchise model is designed for investors who know little about cutting hair. If you are a competent stylist with access to investment money and clients, you would be better off opening an independent salon for a fraction of the cost of opening a franchise.

The typical worker is a recent graduate of a “beauty college” trade school and is looking to build experience. Others are older workers who wish to work part time or who were not successful in or dislike the intensity of high end salons offering more services. The workers are almost entirely female (92%) – and again, low paid.

The work can be either okay or grueling – depending on the facility and the manager. And training requirements vary widely, by state, plus other factors that make life as a student and job seeker a mess. I suspect the field has a Pareto 80:20 distribution – for 20% of those in the field, this is a great career choice earning a good income at an independent salon. The other 80% struggle or work part time.

The Des Moines Register writes “Beauty schools may be the biggest scam in education“. $21,000 in tuition, you get a job at Great Clips paying $9 per hour – and this is not just in Iowa (but Iowa is a particular bad case).

Visiting “beauty college” web sites is amusing. First, all of the photos of guys show a military style razor cut with super short hair and a tuff on top. This seems to be a post 9/11 phenomena where all guys are now, apparently, expected to have a U.S. Army hair cut. Indeed, as the chain haircutting stores have proliferated this too is the male haircut image they push – because its fast, low cost and high volume. 70% of Great Clips customers are male – and the buzz cut is a fast hair cut, whether the client wants it or not.

At Great Clips, stylists are expected to do 4 hair cuts per hour. They may receive a productivity bonus if they exceed this level. The Army or white supremacist haircut takes less than 5 minutes, enabling stylists to exceed their quotas. (I saw a Great Clips discussion saying that some guys haircuts are done in as little a 2 minutes – that was my experience.)

Stylists are encouragde to “up sell” products like shampoos and conditioners, which sell in the salons for much more than equivalent products sell for at your local drug store. Making money doing men’s haircuts is difficult – that’s why it has to be a high volume business. Or, a full service salon offering hair color, perms, weaves, extension and other services. In fact, many in the field say the high end services that women purchase are what make salons successful.

The pay of a stylist in a franchise chain is near minimum wage ($9-$12/hour) plus tips. It can be hard to offer good service that encourages tips when stylists are working against the clock.

For most stylists at these places, its an opportunity to build experience, possibly build a client list, and move on to a higher paying opportunity elsewhere or to possibly become a salon manager or assistant manager. (It depends highly on the local manager as to whether it is a good place to work or not a good place to work.)

The next step for a stylist is to rent a chair at a higher end salon and offer premium high $ services (which includes hair color, perms, weaves, extensions, braiding etc). But to do this requires having a client list to start. Hence, the franchise chains are a starting point for those in the field.

In my market there are about 35 places that do hair cuts (5 barbershops and the rest as mostly independent hair salons). All of the barbershops are locally owned and have 4.7 to 5.0 star ratings on user reviews. All but one of the local hair salons have very high ratings – while the hair salons do cut guy’s hair, most of them are oriented towards female clients. And then there are the retail chains like Great Clips and Supercuts with 3.7 to 4.0 ratings. Some of the retail chains are sometimes seen as scams that prey upon investors, and as shown above, prey upon low paid female workers.

After several months of hair regrowth I will be going to one of the highly rated locally owned barbershops. No more chain outlets for me!

Heh:

At a Great Clips in Chilicothe, OH, (near Columbus), 49-year-old Jimmy Nguyen was so displeased with the haircut he received that he punched the manager in the face. Those of us who’ve suffered a Great Clips haircut have likely acted out similar fantasies in our minds, though few of us punch our stylists in the face.

….

Rough day for Nguyen, but come on. It’s Great Clips. What did he expect?

Source: Ohio Man Goes Apeshit After Great Clips Haircut | Scene and Heard: Scene’s News Blog

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