Had meeting with Xie Wen Hong and her husband today. They asked about the salon status. I explained the situation and the lack of capital. I discussed the payroll. I discussed the need to obtain additional capital. I explained we have a new cost controller in place, a new manager, new consultant and are meeting with several turn around experts. I explained that the new marketing strategy is an important effort we are focused on.
He has tracked the P&L's through the portal monthly. Send him a cashflow statement.
They said do not open the 3rd salon. Two locations is enough. They want to know which salon is performing better. I said they are almost exactly the same at around $3,000 a week. Vista has been open longer and has a higher guest list. Mission lost 7.9k last month and Vista lost 5.5k.
He says they look at the P&L's. They asked why the expenses were so high for Vista in Sept. Answer: construction payments and a supply order. They asked why Vista's revenue dropped in October. Answer: price increase reflected a temporary dip in customers.
He is going to put in additional capital. They want us to be conservative. He has many expenses that are reducing his financial ability. Troubles with his business in China, high cost of tuition for his child and Xie Wen Hong is not employed. He asked that we provide a proposal of the cost to break even and profitability. He asked that we provide a higher return to him now that he is putting in additional capital. I explained we can work that out and would be happy to do that for him.