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Photo: Damien with his daughters, Stevie.
Damien is a staff writer for Hair News Magazine. His articles, quotes,
and interviews have appeared in all types of media and publications in
several languages.
Hair Cut And
Service Pricing
Hair
News Magazine
by: Damien R. von Dahlem
Once people know that I was a salon
owner they frequently ask me about pricing and why prices vary so
widely.
Except for the occasional salon that simply pulls a number out of thin
air, most salons base their pricing on a combination of three factors;
overhead, market, and supply and demand.
Advertising
1.
Overhead.
Overhead is a complex formula that includes such things as the amount
of
rent the salon pays. Once the overhead is calculated a break-even
point is determined and based on that, the prices for that individual
salon
are determined.
For example,
my lease is $1,135. per month, but a salon in Manhattan may pay
$10,000.
per month for that same amount of space. Obviously the Manhattan
salon will need to charge a great deal more per haircut than I
do.
On the other hand, in my salon we spend a small fortune every year on
advanced
training. This expense too needs to be recovered, and it is
recovered
in the price of the haircut.
2.
Market.
Going back to our Manhattan example, clients who regularly shop in
Manhattan
will not flinch at paying $175.00 for a haircut, whereas a salon in
Kentucky
will cause people to pause at a price of $40.00.
Ironically,
the Kentucky stylist may have a great deal more talent than the
Manhattan
stylist, but the market will simply not allow that stylist to charge
more
and still remain in business.
3.
Supply and Demand.
Then there is supply and demand. A given salon may well be in a
break-even
position to offer haircuts at $20.00, but as they are booked solid and
need to create openings for new clients, good business sense dictates
that
this salon needs to raise prices and to continue to do so until they
top
out in their market.
This is the
same principle that dictates why haircut prices vary by stylist, even
in
a given salon. As the stylist books up, he or she needs to raise
their price to make room for new clients, and the most successful
stylist
in a salon is not always the technically best, just the most popular.
You notice
that I continually refer to new clients. This is because new
client
counts drive and grow the business. Salons that do not track
new client counts, and drive new client counts, will eventually go flat
and their earnings will then taper off until they can no longer meet
their
monthly overhead. It is a slow but sure death.
4.
What about those discount cutters who only charge $9.95?
The same principles apply. It is a matter of how you want to
conduct
business. These salons usually have far less overhead. The
decor is minimal, you probably won't be served Starbucks coffee,
and so on.
Consider this,
both Motel 6 and the Ritz will offer you a dry, clean,
bed,
but it will not be at the same price for obvious reasons. It
isn't
the bed that makes the difference, its the ambiance and service around
the bed.
Your better
trained staff will also want to be paid more and I am guessing that the
paycheck of the night clerk at Motel 6 is substantially less
than
that of the front desk at the Ritz.
That is not
to say that you can't get a terrific haircut at a discounter, or even
the
best in your market, it just isn't likely. I know some terrific
stylists
who work for Cost Cutters, and they will remain there for
life for
different reasons, but that is more the exception than the rule.
On the other hand, if you can find one of those jewels it only makes
sense
to save money.
5.As to
those salons that simply grab a price out of thin air?
Typically they are owned by a business wanna-be who because
they
have a cosmetology license, think that all they have to do is hammer up
a shingle and business will flock to their door.
This practice
is not unique to the salon industry, these businesses are however, the
scourge of their individual industry and place an undesirable stigma
upon
all small businesses. A good indicator that you are heading for
such
a salon is if they try to have a "cute" name such as, "Curl Up And
Dye",
or "Chop Shop".
I hope this
gave you some insight into salon pricing, and in so doing will enable
you
to make a fair buying decision.
