At the start of 2020, Chelle Neff is wrapping up a decade of considerable success, growth and innovation. In addition to developing Urban Betty, a successful salon with two locations, Neff also created an app for stylists, produced a book about homes in Austin, Texas, and even reached the Inc. 5000 list twice!
You opened Urban Betty in 2005 and it’s been growing ever since. You also have an impressive array of side projects—from books and apps to philanthropic and environmental initiatives. What drives you? And what’s next?
I live and breathe to continuously grow, evolve and ensure the success of my salon company. While there have been a few times when I thought I’d have to close the doors of Urban Betty, I chose not to give up, to learn from my mistakes and to implement significant changes to save the business.
If I had to name one thing that drives me, in all honesty, I’d have to say it’s the feeling of self-worth. I have this secret battle with my ego and I’m not yet certain if that’s a good or bad thing? I know many entrepreneurs, including myself, have a hard time separating ourselves from our brand. When my brand is doing well, I feel great and want more!
What’s next? I am working on a customized organic Urban Betty product line. We have the perfect platform (along with e-commerce) to bring that to fruition. My husband and I are also pitching a second Weird Homes Tour book with all of the cities in it. We have five cities so far and are bringing in the Bay Area in 2020. Last but not least, I am scouting sites for a third Urban Betty location!
Urban Betty is a Green Circle Salon. Can you explain what that means?
Green Circle Salons provide the world’s first sustainable salon solution to recover and repurpose beauty waste. At our salon, we collect, recycle and repurpose all of our hair clippings, used foils, color-tubes, excess hair color, papers, plastics and glass. We have separate bins for each item, and we send them to Green Circle Salons every month. We charge a small (optional) Eco Fee of $2.50 per guest to cover the cost.
So far, Green Circle has diverted over six million pounds of waste from landfills and waterways. We are so excited to be a part of that revolution.
Describe where the beauty industry as a whole is regarding sustainability and environmental concerns.
The beauty industry is stepping up to the plate where the environment and sustainability are concerned.
Estée Lauder is working closely with the global nonprofit organization Roundtable on Sustainable Palm Oil to ensure that their cultivation methods and sourcing have a minimal negative environmental impact, and L’Oréal has committed to being deforestation-free by 2020. We are a Redken-focused salon, which is owned by L’Oréal, which makes this so important to us.
I am seeing more and more of my staff asking questions and wanting to get involved with recycling and repurposing. When I first opened my salon 15 years ago, there wasn’t education or companies you could reach out to about sustainability.
Now we have lots of options and solutions for our industry. It’s exciting to see more and more salons sign up each year with companies that make it their mission to help our industry become more environmentally friendly.
How is technology changing the beauty industry?
Technology is improving our industry! We have so many amazing things that we can access just from the palm of our hands. Instagram has forever changed how guests can find stylists that appeal to them. Long gone are the days of asking your neighbor or someone in the grocery store.
Pinterest has forever changed our consultation game. We can make different boards that represent cuts, color, up-dos and makeup and show them to our guests, or have them make their own to show us. It’s an extremely beneficial tool, especially for a first-time guest.
Nothing will ever replace an in-person, customized consultation where a professional can feel your hair, assess the damage and recommend the correct products for you to use. There is a worry in our industry about customers seeking to buy on Amazon instead of the salon; however, if you have a powerful consultation and provide excellent customer experience, you shouldn’t have to worry about that. Our retail sales have only increased each year, so I know the power of an in-person experience versus an online one.
Tell us about your transition to a desk-less front desk.
I first learned about the desk-less front desk at a salon owner’s convention, and the idea clicked for me and made sense.
It was unfortunate because about a year earlier, I had invested US$10,000 on a new front desk for our flagship location, and so I wasn’t going to tear it down anytime soon. But, I knew I’d be opening a second location the following year, so I used this opportunity to build the desk-less front desk!
The idea is that guests don’t want the experience of a “fortress” separating them from your staff. Guests wish to have an open and intimate experience. It’s a simple concept inspired by the Apple Store. At our SoCo (second) location, we have a bar that is open on all sides with two computers. This model gives guests the ability to be more comfortable, engage, connect and ask questions with our front desk staff.
It is my goal to one day revamp the front desk at our original location to match this model, and I will forever utilize this concept at every future salon that we open.
You mention that this last year has been all about growth—74% growth in the last three years, according to Inc.com. Growth naturally comes with obstacles and opportunities. Can you share any specifics?
Yes, without the struggle, I feel there is no opportunity for growth. I learned the phrase “celebrate all mistakes” in 2019, and I have made that my motto! The most significant struggle I had at my salon company was learning how to create structure and systems that would, in turn, generate profit.
I started with a contractor-based model, and then slowly switched to a commission-based (employee) model. I kept trying to change things up thinking, “this will be the thing that will turn my P&L around and make a profit.”
After 11 years of being stuck in that hamster wheel, I decided to turn to professionals in my industry and ask for help, which, by the way, is extremely hard for me to do! I hired a consulting group called Summit that changed my life.
First, we restructured our pricing list based on the demographics in our surrounding area. We were charging prices that were way too low and giving package deals. We switched to an a-la-carte service menu to help alleviate those issues. These two things by themselves made a significant impact on our profit. We also created a career path for our service providers based on a six-tier level system. The first level starts at a 40 percent commission rate, which increases to 54 percent at level six, the highest-paid commission rate. Service providers are given direction through monthly one-on-ones and goal setting.
Within three months of implementing Summit’s methods, we had more money in our bank accounts than ever before. And two years later, I was able to retire from doing hair and focus solely on managing and scaling my company.
Was earning a spot on the Inc. 5000 a specific goal of yours? Will you be aiming for it again next year?
YES! To be named as an Inc. 5000 company two years in a row was a huge goal of mine. I feel it’s like winning the “Oscars of the business world.” I will always throw my hat in the ring for Inc. 5000 and strive to grow just for that honor. I would love to get it three times!
You joined the Austin chapter of the Entrepreneurs’ Organization (EO) in January 2019. How has EO influenced your growth and your journey as an entrepreneur?
I can honestly say that EO has influenced me more on a personal/emotional level in my journey, thus far. We all know that when we grow emotionally, our business tends to follow.
My motivation when joining EO was to gain more of a support network of business owners around me. I could not have imagined that, despite how different our industries/businesses are, we all share a common vision and have similar questions.
I have met people who echo the same life questions in our Forum meetings that resonate with those of my very own, even ones I hadn’t fully become conscious of yet. I have learned that it’s okay to make mistakes and share them. It’s not embarrassing now; it’s empowering. Finally, feeling that as an entrepreneur has given me grace in places that I truly needed it in 2019 to grow and learn.
What has been your favorite EO event or benefit so far?
I got to meet Howard Schultz, former CEO of Starbucks, in person within three months of becoming an EO member! He spoke for our EO Austin chapter during SXSW, and I was one of five people chosen to meet with him for a small, private question-and-answer session. It was a powerful moment, and he gave some great advice to us that day.
Learn more about other EO members and what it’s like to join a global network of peers.