Small Business: A salon and spa on the brink of failure has turned into one of South Jersey’s busiest.
More off-putting than dark roots, unkempt cuticles, and a face in need of a good peel was the condition of the Biaggio Salon & Spa in Marlton when it wound up in court-appointed receivership in 2007.
Checks to employees and vendors were bouncing, the landlord had begun eviction proceedings, and the company owned by Thomas J. Fabiani and his son Thomas M. was $1 million in debt.
"Biaggio had such a dark cloud over it," recalled Kim Carulillo, who at the time was working the salon's front desk after a 12-year career as a paralegal left her wanting a more people-oriented job.
Eight years later, a makeover of enormous proportions has turned a high-glamour business on the brink of failure into what industry players say is one of South Jersey's busiest salons.
Renamed Suede Salon Spa & Body, the business in the Promenade at Sagemore shopping complex is now owned by three former Biaggio employees: Carulillo; her cousin Lisa Verdecchio, a hair stylist; and Nancy Rooney, a manager, all of whom saw potential amid the gloom.
Their instincts were right, it seems. Annual sales are "single-digit multimillion," the owners said, declining to be more specific. The salon employs 120, double what it did at the time of its court-directed sale in December 2007, and last year it launched a makeup line.
"Makes it all worthwhile," said Alfred T. Giuliano, the court-appointed trustee who oversaw Biaggio's final four months, trying to instill calm and keep key stylists from fleeing.
If anyone had reason to run screaming, it was Rooney. A hair stylist at rival Toppers for 10 years, she had wanted to get into the business end of the beauty industry. So she bought 250 shares of Biaggio Inc. for $200,000 in December 2006.
Rooney soon realized she had bought into trouble and filed a lawsuit in New Jersey Superior Court against Biaggio and the Fabianis, claiming breach of the stock-purchase agreement and her employment contract.
In summer 2007, the court ordered Biaggio and Thomas M. Fabiani to repurchase the stock from Rooney for $220,000. That did not happen, and on Aug. 29, 2007, the court appointed Giuliano.
On Dec. 18, 2007, the court authorized his recommendation to sell the salon for $400,000 to Rooney, Carulillo, Verdecchio, and another stylist who has since relinquished his ownership interest.
What followed was the monumental task of building trust among employees, vendors, and clients.
"There were times when I wondered if there would be a salon," recalled Kim Sabo of Maple Shade, who started at Biaggio as a receptionist a few months before it was sold and is now Suede's general manager.
Rosalie Maida wondered, too.
"It was like a revolving door with people going and coming, the stylists," said Maida, a Biaggio client since she moved to Marlton in 2006. "That kind of makes you nervous as a client."
So skittish were vendors, the only payment arrangement they would entertain for the first year was cash on delivery. Even though $120,000 in gift cards the previous ownership issued were worthless, given that the company was so deep in debt, the new owners honored them anyway to foster much-needed goodwill with customers.
"That's the only way the business was going to make it," Carulillo said.
Thomas M. Fabiani, 41, who, records indicate, lives in Medford, could not be reached for comment.
The new owners made a point of being visible on the salon floor to help foster a sense of stability, and the salon did a lot of charity work, in part to counteract the perception it had closed. Once word got out that the drama had subsided, stylists from other salons came calling for jobs.
"That was the aha! moment . . . where people were coming to us," Rooney said.
Instituting a more structured work environment, including adding managers, was also key. Vacation was limited to one week per year, and any social-media posts that would reflect badly on the salon were discouraged.
"It's run more like a business and not fly by the seat of the pants," said Robert Talewsky, a sales consultant for East Coast Salon Services in Runnemede, a supplier to the salon since it opened as Biaggio in May 2002. "It makes a vendor feel more secure."
Verdecchio, 49, of Voorhees, still cuts hair twice a week, saying "it keeps me sane," and oversees staff education. Rooney, 44, of Medford, and Carulillo, 49, of Marlton, handle administration.
All are married with children. Compared with the day they were awarded the business, they are relatively Zenlike.
"After a couple of years, we felt, 'We got this,' " Carulillo said.