marie-louise coster writes the price is right


Implementing a price increase can leave many salon owners nervous; Marie-Louise Coster shares her advice to ensure a smooth transition.


Being typically British we don’t like to talk about money, it almost seems a dirty word and a subject that people avoid like politics and religion. However money, and in particular cost, is something that does need discussion and consideration when running a beauty salon.


Some business owners go years and years without implementing a price increase, charging exactly the same price that they charged five (or more) years ago – and why? Quite simply, because they are fearful that implementing a price increase will alienate their clients and discourage clients from returning to the salon, but you will never run a successful business this way. I know that calculating your costings when you are working out what to charge is a laborious task – I also know many salons don’t even do it and just look at what other people charge which is a recipe for disaster! You must work out your product cost but you also need to include what you feel your time is worth and what you need to earn per hour.


work out your costs


I believe that most people expect a small annual price increase as everything goes up periodically – whether it is a loaf of bread, a pint of milk, or a tank of petrol. Of course, you don’t need to put your prices up unless the cost of doing the treatment and providing the service has gone up to you and that increase of cost may be the actual product or other overheads i.e. rent, rates.


If these costs go up, your cost to your client must also go up. Work out what the extra cost to you is and add it to your current prices. If it is purely the product cost that has gone up, the


To ensure you are charging the correct price, you must work out your product cost but you also need to include what you feel your time is worth and what you need to earn per hour..


manufacturer or distributor will be able to give you a breakdown of the treatment cost which will make life much easier, you will just need to add your other costs to it. If it is your rent, rates or other overheads that have risen, you could randomly add an extra 50p or £1 to all treatment prices, or you could work it out specifically. Begin by taking the extra cost – let’s say for example that your rent goes up by £100 a month that equates to £25 a week, which is approximately £4.17 a day (over a six day working week), which if you are open seven hours a day is 60p an hour. This would then need to be divided across your treatment columns – so if you have six therapists working for you each day, each of their treatments would need to go up by approximately 10p. Of course, if several of your overheads go up you would need to work them all out, but you get the gist.


Many salons will have an annual price increase regardless of their overheads increasing. In my years working as an Account Executive, I came across many salons that had an annual price increase of 10% across every treatment they offered which in some cases can be quite a hike. If you take a facial at £55 the increase on that would be £5.50 which, to me, does seem quite a jump. I think a couple of pounds is easily ignored and absorbed by the client but when you jump from £55 to £60.50 you enter a whole new price bracket and it sounds much more.


Something that is very common in the hair industry, and may be worth implementing within your own business, is a tiered pricing structure depending upon the level of experience and qualification of the therapist. If you have a therapist with 10 years’ experience in


GUILD NEWS 89


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