7 Essential KPIs for Beauty Schools to Boost Success

Welcome to the beauty school industry, where tracking performance metrics is crucial for success. As a seasoned entrepreneur in this field, I am excited to share the top seven KPIs that every beauty school should monitor.

• Student retention rate: This metric measures the number of students who continue their education after enrolling. In a thriving beauty school, the student retention rate should be high, indicating that the school provides quality education and a supportive environment for students.
• Average salary of graduates: A key indicator of a beauty school's success is the earning potential of its graduates. Tracking the average salary of graduates can help the beauty school improve its curriculum to increase student employability.
• Customer satisfaction rating: In a competitive industry like the beauty school, customer satisfaction is key. Measuring feedback from current and past students can help the school improve its services and reputation.

These are just a few of the KPIs that beauty school owners should be tracking. Keep reading to learn about the other essential metrics that can help your school grow and thrive!

Student retention rate

Student retention rate is a crucial KPI for beauty schools as it measures the percentage of students who stay enrolled in the program from beginning to end. This metric helps in assessing the effectiveness of student support, satisfaction, and engagement.

Definition

Student retention rate is the percentage of students who were enrolled in a beauty school at the beginning of a specific time period and continued their studies until the end of that same time period.

Use Case

Beauty school administrators can use student retention rates to identify how effective their institution is at retaining students. Knowing this rate can reveal potential problems, such as curriculum limitations or student dissatisfaction, which can then be addressed and resolved to increase retention.

How To Calculate KPI

To calculate the student retention rate, divide the number of students who completed the specific time period by the total number of students who started during the same period. Multiply the result by 100 to get a percentage.

Calculation Example

Suppose a beauty school started with 50 students, and during a six-month period, 45 of them completed the program. Then, the student retention rate would be:

KPI Advantages

• Helps beauty school administrators identify the effectiveness of their institution at retaining students.
• Reveals potential problems, such as curriculum limitations and student dissatisfaction.
• Can lead to targeted interventions that boost student satisfaction, engagement, and retention, ultimately improving institutional performance.

KPI Disadvantages

• Not all student attrition is negative. For instance, some students may leave for positive reasons such as job offers.
• Calculations based on the time period may not be consistent across schools.
• Some schools may have higher student retention rates due to easier course difficulty or lower entrance requirements, which may not necessarily align with the school's goals and mission.

Industry Benchmarks for the KPI

The National Accrediting Commission of Career Arts and Sciences (NACCAS) recommends that the beauty school student retention rate should be at least 70%.

Job Placement Rate

Definition

Job placement rate is a KPI metric that measures the percentage of students graduating from a beauty school who have landed jobs in their respective fields. This metric is an essential tool that helps beauty schools assess and improve the quality of their education programs and job placement services, as well as help students make informed decisions about their education and career paths.

Use Case

A successful beauty school should have a high job placement rate, indicating that its graduates are finding jobs in their fields of study. This information can be used to evaluate the effectiveness of job placement services offered by the beauty school, the relevance of the curriculum and the school's reputation in the beauty industry.

How To Calculate KPI

To calculate the job placement rate KPI, you need to divide the number of students who have landed jobs in the beauty industry after graduation by the total number of graduating students. The formula for calculating job placement rate is:

Calculation Example

If a beauty school graduates 100 students in a year, and 80 of those students secure jobs in the beauty industry within six months of graduation, the job placement rate KPI would be calculated as follows:

KPI Advantages

• Helps beauty schools to evaluate and improve their education programs and job placement services
• Assists graduating students in making informed decisions about their future careers
• Enables beauty schools to track the success of their graduates in the job market

KPI Disadvantages

• Does not consider the income level or job quality of the graduates' jobs
• May not fully account for graduates who decide to pursue additional education or change careers before finding jobs in the beauty industry

KPI Industry Benchmarks

The benchmark job placement rate for beauty schools varies across the industry. Typically, a job placement rate higher than 70% is considered good. However, the benchmark rate may change depending on the location, type of beauty course and beauty school.

Average Salary of Graduates

Tracking the average salary of graduates is an essential KPI for beauty schools. It measures the success of the institution in preparing students for the job market.

Definition

The average salary of graduates KPI measures the average earnings of all students who have completed the program and found employment in their respective fields.

Use Case

Beauty schools can use this metric to demonstrate the value of their programs to potential students and employers. It can also indicate areas where the school needs to improve to increase job opportunities and earnings for its graduates.

How to Calculate KPI

To calculate the average salary of graduates, use the following formula:

Calculation Example

Suppose a beauty school has 100 graduates. The total earnings of the graduates are $500,000. The average salary of graduates would be calculated as:

Therefore, the average salary of graduates is $5,000 per year.

KPI Advantages

• Provides a measurable way to assess the effectiveness of the school's programs in preparing students for the workforce
• Can help schools identify areas that need improvement to increase student earnings and job opportunities
• Can be used to promote the school and attract potential students and employers

KPI Disadvantages

• Does not account for graduates who do not report their earnings or are unable to find employment in their field
• Does not consider the cost of living in different regions or countries
• May not reflect the earning potential of all graduates, as some may choose to pursue additional education or work part-time

KPI Industry Benchmarks

The industry benchmark for the average salary of graduates varies depending on the type of beauty program and the region. In the United States, the median pay for skincare specialists in 2020 was $34,090 per year, according to the Bureau of Labor Statistics. However, this may vary depending on the location and type of services offered.

Number of Partnerships/Collaborations Formed

Definition

Number of Partnerships/Collaborations Formed is a Key Performance Indicator (KPI) used to measure the number of strategic collaborations or partnerships that a beauty school has formed with other relevant organizations in the industry. It is an important metric to track since it helps the school to determine and monitor the effectiveness of its partnership strategies and how it influences the growth of the business.

Use Case

Tracking the number of partnerships/collaborations formed is essential for every beauty school as it allows them to measure the success of their partnership strategies. By partnering with other organizations, beauty schools can attract more students, offer more courses, expand their reach, and increase revenue. Additionally, these partnerships help to establish the school as an authority in the beauty industry, thereby attracting more potential students, instructors, and investors.

How to Calculate KPI

Divide the total number of partnerships/collaborations formed during a specific period by the total number of months in that period. Then multiply the result by 100 to get the percentage. The formula can be represented as:

Calculation Example

Suppose a beauty school formed 20 partnerships/collaborations in the first half of the year, which is six months. To calculate the KPI, the school would divide 20 by six, which gives 3.33. The result would then be multiplied by 100 to get the percentage. Thus, the number of partnerships/collaborations formed in the period would be 33.33%.

KPI Advantages

• Measuring the number of partnerships/collaborations formed helps schools to evaluate their partnership strategies, identify their strengths and weaknesses, and make informed decisions.
• It allows the school to track the effectiveness of its partnership efforts over time, allowing for improvements and corrections.
• By partnering with relevant organizations, a beauty school can introduce new courses, programs, and certifications, which, in turn, can attract more students and generate more revenue.

KPI Disadvantages

• The number of partnerships/collaborations is not always an indicator of performance since it does not measure the quality of partnerships formed. It is possible to form several partnerships that do not benefit the school or its stakeholders.
• It can be challenging to distinguish between partnerships that result in significant benefits for the institution and those that do not.

KPI Industry Benchmarks for the KPI: 'Number of Partnerships/Collaborations Formed'

There is no standard or official benchmark for this KPI since it varies by institution, industry, and region. However, a good benchmark would be to compare the number of partnerships/collaborations formed in a specific period to that of other schools in the region or industry.

Customer Satisfaction Rating

Definition

Customer satisfaction rating measures how satisfied your customers are with the services provided by your beauty school. It is a crucial Key Performance Indicator (KPI) for tracking the success of your business.

Use Case

The customer satisfaction rating KPI is used to gauge the success of the beauty school in meeting the needs and expectations of its students. It is a valuable metric for measuring the overall quality of service provided by the beauty school.

How To Calculate KPI

To calculate the customer satisfaction rating KPI, divide the number of satisfied customers by the total number of customers surveyed and multiply the result by 100. The formula is as follows:

Calculation Example

If there were 80 students surveyed, and 70 of them reported being satisfied with their experience at the beauty school, the customer satisfaction rating KPI would be:

KPI Advantages

• The customer satisfaction rating KPI provides insight into how well the beauty school is serving its customers.
• The KPI allows the faculty to assess which areas of the school may need improvement to better meet customer needs.
• A high customer satisfaction rating can increase customer loyalty and retention, leading to business growth and success.

KPI Disadvantages

• Some customers may not participate in surveys, causing a selection bias in the data.
• The customer satisfaction rating KPI may only provide a surface-level look at customer satisfaction and may not capture the complexity of each customer's individual experience
• Students' satisfaction may not always translate to long-term success in the beauty industry.

KPI Industry Benchmarks

The customer satisfaction rating KPI is an essential metric across the service industry. According to industry benchmarks, a good customer satisfaction rating is between 80-90%. This benchmark may vary depending on the target audience and industry.

Percentage of students who start their own businesses

As a serial entrepreneur and business founder, one of the most important Key Performance Indicators (KPIs) to track in the beauty school industry is the percentage of students who start their own businesses.

Definition

The percentage of students who start their own businesses is a KPI that measures the number of graduates who start their own businesses in the beauty industry. This is an important metric for beauty schools since the goal of many students is to own their own beauty business and become an entrepreneur.

Use Case

Tracking this KPI can help beauty schools understand how successful their programs are in preparing students for entrepreneurship. It also enables schools to identify areas where they can improve their programs to better support students in achieving their entrepreneurial goals.

How To Calculate KPI

To calculate the percentage of students who start their own businesses, divide the number of graduates who started their own businesses by the total number of graduates and multiply by 100.

Calculation Example

If a beauty school graduates 100 students and 20 of them start their own businesses, the calculation is as follows:

Therefore, the KPI for this beauty school would be 20%.

KPI Advantages

• Helps beauty schools track the success of their programs in preparing students for entrepreneurship
• Provides insights into areas where beauty schools can improve to better support students in achieving their entrepreneurial goals
• Enables beauty schools to differentiate themselves from competitors by highlighting their success in producing graduates who become successful beauty industry entrepreneurs

KPI Disadvantages

• The KPI does not take into account the time it takes for graduates to start their own businesses, which can vary widely depending on factors such as financial stability, personal circumstances, and market conditions
• Does not measure the success or failure of the businesses started by graduates, which can be an important metric to track in the long-term

KPI Industry Benchmarks

Industry benchmarks for the percentage of beauty school graduates who start their own businesses vary widely depending on geography, market conditions, and other factors. While there is no one-size-fits-all benchmark for this KPI, beauty schools can use their own historical data to set their own benchmarks and goals for improvement.

Number of students enrolled in advanced courses

Definition

The number of students enrolled in advanced courses is a key performance indicator (KPI) that measures the number of students registering for more advanced courses, such as advanced makeup application, advanced haircuts or color classes.

Use Case

This KPI is essential for beauty schools to track since it shows how well students are engaged in the curriculum and how successful the school is at offering advanced courses. Schools can use this data to make decisions about what courses to offer, when to offer them, and how to promote them better.

How To Calculate KPI

The formula for calculating the number of students enrolled in advanced courses is:

Calculation Example

Suppose you have 200 students enrolled in your school, and 50 of them are attending advanced courses. The KPI is then calculated as follows:

Therefore, the KPI indicator for this school is 25%.

KPI Advantages

• Measures student engagement and helps to identify advanced courses that are popular among students.
• The KPI helps schools make data-driven decisions about course offerings.
• Allows schools to promote courses more effectively.

KPI Disadvantages

• This KPI alone does not give insight into the quality of the courses.
• It is not useful as a standalone metric and should be used in conjunction with other KPIs to get a complete picture.

KPI Industry Benchmarks

The average percentage of students enrolled in advanced courses across the industry is about 20%. However, this figure can vary widely depending on the type of school, region, and industry sectors.