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Over the past two years, business owners have been confronted with more challenges than they could have ever imagined. 

While COVID-related lockdowns and restrictions might be behind us, beauty businesses have encountered a new problem: rising levels of no-shows and last-minute cancellations. 

Without little to no warning, cancellations can throw your business' cash flow completely out of whack. However, there's one dependable strategy to reduce the cost of no-shows in your salon: online deposits.

“We use deposits really as a way of managing cash flow and stopping no-shows and cancellations,” says Jason Donnelly, founder of Asylum Hair and Beauty. Donnelly had mulled over the decision to implement deposits for a while but it wasn't until his business experienced record cancellations over the Christmas period that he decided to pull the trigger.

The benefits of online deposits

Timely research shows that businesses that take a deposit reduce their no-show rate by a whopping 55 per cent. Online deposits ensure your client is committed at the time of booking and that you are paid for your time. 

By having regular cash coming in from pre-paid deposits, you can spread out your costs and set yourself up for financial success. “Now, even if we do get a last-minute cancellation, it means we still make money for those free time slots,” Jason explains. “This means we know our cash flow for those times will allow us a business to keep going.”

How to implement a deposit policy

Before you start taking deposits, you'll need to set up an online payment gateway. TimelyPay allows you to easily take online payments from clients and request a deposit on booking.

Then, you'll need to double down on the details. You could ask for full or part payment, depending on what suits your business. Once you take a deposit, TimelyPay allows you to store your clients' card details, making the final in-salon payment a breeze. 

When you're ready to get started, it's important to communicate your new policy. You could do this via your website, social media or at the time of booking. If you don't like the word ‘deposit', try labelling this payment as a ‘booking fee' instead. 

While there might be an adjustment period while your regulars get used to the change, remember that the benefits of taking a deposit far outweigh the cons.

For more information on how Timely business management software can help your salon or spa, contact the team at 020 3808 0465 / gettimely.com

(Sponsored Story)