Matthew Doctor: Thanks Eric.
Kersten Zupfer: Thanks Eric.
Biz McShane: All right. Next, we will go to Sydney Wagner from Jefferies. Please remember to unmute your line, Sydney Wagner
Sydney Wagner: Hi, are you guys able to hear me okay?
Matthew Doctor: Yes.
Biz McShane: Yes, we can.
Kersten Zupfer: Yes, we can.
Sydney Wagner: Perfect well, thank you for taking my question. So my first question was just around the labor market and stylist retention and recruitment. Where do stylist count levels fall relative to where they were pre-COVID. And then I’m just curious on any early reads or feedback you have from the stylist recruitment initiatives?
Matthew Doctor: Sure, thanks this is Matt. So I appreciate the question where they fall versus pre-COVID – it’s pretty interesting. I think you’ve talked about this at late it kind of matches up pretty much with kind of traffic declines that we’re seeing. So this is around 20% down from an hour’s work perspective versus pre-COVID. And again, that is something that recently has been fairly stable and any incrementality of just increasing those hours works even just one hour, 1.5 hour per salon per day can have some significant impact on our franchisees’ profitability on top line. So the various factors that have been moving this in a positive direction where we see it, a lot of different things, franchisee pay plans, commission structure, salon culture, access to training, all the things that we’ve hear and we’ve seen, which is why this is where we’re putting so much of our focus in to: one, get the story out there; two, ensure our training leaders and managers are trained on the soft skills to provide a great culture.
So we know how important managers are. So when we talk about salon training and education, we really felt this was really a very important place to put some time and effort even we know like a lot of industries. to bad managers. So we can’t overlook that piece of the education side, and so we’re excited to start rolling that piece out and other things regarding the technical trainers that get hands on in our salons. I had mentioned some early findings that those salons and technical trainers are outperforming the system. I’ll add some more figures and context around that. And some of the data that I’m quoting is November and December results just given, it’s been early days since we’ve scaled that up so fast. But from a level of sales outperformance on an overall brand perspective, we’re seeing that range from salons that have these trainers and them from anywhere from 4% above the rest of the system in one brand, up to 14% in another.
And we’re also seeing that requisite outperformance in styled hours and 90-day retention for those who have those design team members. Some are retaining 4% better from a 90-day retention side and even up to 7% more stylist hours work. So these are things early figures, encouraged that they’re seem to be working on the right path regarding that investment, and we’re going to continue to do so in an effort to move the needle on that recruitment and retention side.
Sydney Wagner: Got it. That’s helpful. And then just another one kind of on the customer wait time. So I think you’d called it out as one to two months. So just curious like what your target time is. And then if you’re seeing any shifts in spend per visit, curious on any color there.
Matthew Doctor: Yes. I think it’s less so on target how often we’re getting folks to visit. I think we’re going to be okay with stretching cycles out as long as we’re increasing our traffic base. So — and that’s between two things. One, just keeping those who are coming in whatever cycle they’re coming in at a better rate which I think we have a ton of opportunity to do and probably the highest ROI and focus we can have right now. We have a lot of traffic coming through our system. Let’s just keep them better. And that will go a long, long way and something that’s in our control through the development of, as I mentioned, CRM and loyalty, bring in that stickiness, that’s going to go a long way from the traffic we already have, regardless of how often and the various reasons are coming through.
And then obviously, there’s the opportunity to drive additional. So we can drive additional folks, and I’ll just add to that pool, which will go a long way into effectuating that traffic number kind of regardless of where that cycle is. In terms of spend, yes, spend has been up, and that’s just been a product of price increases that franchisees and our system has been taking, which has been quite in line with other industries and retail and what have you. So kind of we’re seeing anywhere from 20% to 25% higher tickets versus a pre-COVID level due to the price that has been taken here.
Sydney Wagner: Got it. That’s helpful. And then just my last question is just about the same-store sales up 4.5% and the trends that you’re seeing there. And then how those maybe vary by region and concept.
Matthew Doctor: Yes. I would say probably more so by concept than region. And I’d point you to our press release where you can have kind of the breakdown of the various brands. So you can see supercuts and portfolio of brands being up anywhere from 6 to 7-plus percent. And that’s really kind of in those couple groupings of buckets and then the SmartStyle brand is actually down on a year-over-year perspective. So I will say, disparity is really kind of driven by those brand perspectives. Regionally within the brands, we actually see fairly uniform performance, which actually that means that we can effectuate on kind of an overall layer across the brand, so really taking more of a brand approach than having to take a regional approach.
Unidentified Analyst: Got it. Thank you so much.
Matthew Doctor: Thank you.
Biz McShane: All right. We’re going to go now to a question from the chat. Matt talk about the health of the franchise system and where we see our franchise system going?
Matthew Doctor: Yes. No, it’s a good question. I appreciate you asking. As I mentioned, this comes back to just continuing on the recovery. The franchisees have gone through a couple of years of a difficult time given what’s happened through COVID and we’re just focused on getting that business back on track. I mentioned stylist hours worked per a previous question, about 20% down. So we have a lot of opportunity to drive our sales, to drive franchisee traffic, to drive franchisee profitability through increasing that workforce to making them more productive. I think that will go a long way for franchisees businesses. And really kind of everything we’re doing here, every program that we’re looking to roll out from a technology platform perspective, as I mentioned, from our efforts around recruiting and retention perspective, from our customer marketing and 90-day retention for that, that is all in an effort to look to increase franchisee sales and franchisee profitability, which we know is the most important thing right now.
Biz McShane: Thank you, Matt. Those are all the questions we have for now. Thank you for joining the Regis call.
