The issue of increasing our prices is never an easy one, but the valorisation strategy can help you move your business forward. This is the science of motivating consumers to pay more for brands, products, and services, which most brands need to move forward and to grow their market. In simple terms, we need to make clients understand why our price increase is actually a benefit to them.
Firstly, you need to stop listening to all the incorrect information you see onInstagram. I feel the industry is sharing far too much with the consumers –we should never tell clients that our prices have only increased because our expenses have gone up. Instead, we need to create value on the service we are selling.
To increase the perceived value, we have to give a good experience and make the clients understand that this is all done for them. We need to increase prices tactically based on specific strategies for our target market –remember, value is in the eye of the beholder.
So, what steps can salon owners take?
Focus on growing your client base: The number one way to generate more profit is simple; you need to get more clients into your salon and retain them. The cost of acquiring new clients is high, and you will likely need to focus your attention on marketing or special offers to get new faces through your doors. But it will be worth it.
Increase customer spend: Along with increasing the number of clients you have on your books, the next best way to improve your salon profit is to increase the amount of money your existing clients spend per visit. It’s well known that your most loyal clients are more likely to spend more with you. So again, building a relationship with everyone who visits your salon is vital.
Encourage your clients to visit the salon more often: Just as you want to get as many repeat clients as possible, you also want to maximise the number of times they come to your salon. The more they return to you, the more profit your salon will make. There are a few simple ways to start doing this: ask clients if they want to book their next appointment before they leave, and don’t underestimate the power of loyalty schemes.
Reduce your salon overheads: It’s very important to trim away anything that is eating too far into your profit margin.Every year, you should analyse all of your overheads and identify any points of unnecessary spending. Always check that you are getting the best deals for your fixed costs, such as energy bills and insurance. We have managed to swap the way we work by creating the same profit with 30 people fewer on our pay roll, in turn allowing us to give our existing staff a salary increase.
However, if you feel your business is becoming stagnant, it’s important to focus on company culture and implement some changes. We need to do more than simply incentivise our team with money; instead, we should focus on creating purpose and impact.If we fail to do this from the top-down, we will never get the work we need from the bottom-up. It’s that simple.
Culture is essential for companies of all sizes. Many small companies begin with culture, but lose it as they grow. To avoid this, make fun marketing your priority. Try and improve leadership too –if we’re all being honest, every business can improve in the leadership department.Leadership is a practice that’s never mastered, and it’s easier to lose than to gain. However, it can always be improved when made a priority, and this is the easiest way to better your business.
Hairdressers are artists and not all artists know or understand how to run a business. Personally, I believe that if the salon owner is a hairdresser at the same time, they should employ someone to run the business for them –it is very difficult to do both and be impartial on the decision-making. But I do agree that the salon owner, especially during the hard times or quieter days, should be present in the salon every day. Dedication starts from the top.
So, when it comes to moving the business forward, the three key priorities I’d advise are focusing your energy on employed team members, educating the team, and investing in a good marketing strategy.