It’s pretty obvious that you need to be careful when setting up your salon pricing strategy. The competition is tough, and you need to understand the balance between the services you offer and the prices you set for them.
In order to do that, you have to study finances and business but simplified. Once you find that balance, both your clients and yourself will be pleased. You will obtain the profit you initially planned to win in the first place, and your clients will keep coming to your salon because of your quality, accessible services. In order to make them conveniently accessible, check out Amelia – it can help you set a system that will enable your customers to choose a stylist, browse procedures and book a visit in advance.
You definitely need to get informed about the proper salon pricing strategies to get things right. It might take some time, but pricing is one of the most important details about your business, so it is surely worth all the trouble. You don’t want to set your prices wrong from the very beginning, as the mistake will be difficult to correct in time.
What are the first steps?
First of all, you need to ensure that you know how much your services are worth. Setting the prices right is all about avoiding under or overcharging them. A price that is too high or low can send your salon to the bottom in an instant. This is why you need to follow these few steps when choosing your salon pricing sheet:
Assess your services
Start analyzing every service you offer to your clients and set each price individually. You don’t have to be a math genius to put together a price list, but you need to do some research. Once you set your initial pricing list, you might want to apply a financial formula for eventual discounts or other modifications that the prices will suffer in the future.
Build your brand
Your brand is highly important when it comes to pricing. People won’t pay a huge price for a brand that they don’t recognize, so you have to start getting the word out about your salon. The products you use, the professional employees you hired and the numerous satisfied clients that you already have should be the elements you focus on to build a strong brand for your salon. Then, you can get the prices up.
Sell the experience, not the service
Never focus on the services alone. You need to convince the client that your salon is the only one that can offer him such an experience. To do that, make sure you hire a professional team to take photographs of your salon, products, and overall experience during the work hours. Then, promote the services by giving people some insight into what you sell.
Customer loyalty is the goal
The more loyal the customers, the more you can raise the prices. Repeat business should be your main focus, considering that you own a salon. Invest in business cards or booking apps to help clients make an appointment easier and remember your salon. Promotional cards and email campaigns will do the job as well.
If your salon is not that popular, but you know some that are popular enough so that clients can trust them, you can seek a partnership. At first, this is a good strategy to advertise your brand. You can also get partners in other industries than yours, such as a gym or a community center.
Leave discounts for later
When you are at the beginning of your journey, you can’t afford to offer discounts. Remove the discounts, for now, sell your services at their full price and – once your salon gets profitable – you can start offering discounts when you notice that your sales went down.
Don’t ever undercharge
Even though you might not think that your salon is valuable at the moment, it is just a perception that will modify in time. Don’t undercharge your services just because you think your salon is not good enough. Check the competition and see how their pricing list looks like. For instance, look for Walmart salon pricing or the average hair salon prices in your area.
Simplify it as much as you can
Many salon owners tend to go over their heads with the pricing list. No – you need to keep everything as simplified as possible. Keep the list of your services clean and the prices even cleaner. Have you ever seen a hair salon pricing menu? It has a lot of choices anyway, so why make it even more complicated?
Try to list the services in the easiest way as possible. Both your employees and your customers will thank you for it in the long run. When your team charges clients for a service, they want to have clear options to choose from, not a variety of services that are similar in too many ways. Of course, you need to keep your services diverse, but not extremely similar and differently priced, as many salons tend to do.
Keep in mind that the price list is the first thing you have to consider when launching a salon. If you ruin your reputation with a faulty price scheme, you will regain it through tremendous efforts.
Key factors that can affect the prices of your services
What can affect how expensive or cheap your services are? Find out below.
As mentioned before, making your clients come back to your salon only is a high-end move. Try to please your clients and the profits of your salon will be maximized shortly.
Promoting the smart way
You don’t need to invest a fortune to get your salon promoted. You can include specific offers in your pricing scheme. For instance, if a customer purchases a cosmetic product from your salon, they get a discount on the service. This way, you promote what your salon has to offer without an additional budget dedicated to it.
Besides the haircut prices, you might want to think about complimentary services as well. Add deluxe packages to the services that you already have in your list. Massages or exfoliation are just some of the add-on services that clients often choose. For a small effort and a little product usage, you can charge customers more.
Shifts and workload
Consider the fact that people make salon appointments during the weekend or in the afternoon, so try to accommodate the demand using shifts. This way, you can pay your employees efficiently and not spend more than you can handle on salaries.
Timing is key
Finally, you should think about adding offers based on the schedule of the salon. Since workload isn’t properly distributed in salons, you might want to add promotions during the off-peak time, so customers are encouraged to come, even when your salon is not usually booked.
Tips you should keep in mind at all times
You can’t set your prices right without considering these:
Use a salon pricing template to stick with a pattern when setting prices. A realistic price means that you are aware of the direction of your salon, the expenses you face, the resources you have and the financial goals you want to reach. Don’t set prices the same as your competition because that won’t encourage clients to choose yours over others. Come up with your own, realistic pricing structure.
Covering the spending
You can’t charge less than you consume. The costs associated with your services must be visibly lower than your profit to call it a successful pricing strategy. Analyze how much money you spend during a week and set the prices accordingly.
Learn what inflation is
Each country faces inflation at some point, so try to keep up with the latest news in terms of economy. During inflation, the costs of the products you need to run your services may rise which means you need to adjust the prices too.
Value the time resource
Sometimes, the cost of your services must focus on how much time and effort is involved in it. Your time is the most valuable resource you possess, and you clearly don’t want to invest it all in your business. Your hair salon pricing list must include the effort you put in as well.
You can price low
Pricing low is not a mistake, as long as you do it the smart way. New entrants in the beauty industry can opt for this strategy until they gain a reputation. Penetrating the market with a low pricing list is a common strategy, but it might have repercussions in the long run. Once clients are accustomed to your salon’s low prices, when you are going to raise them to the point they are profitable, you will have lost most part of your clients.
Take advantage of holidays, the birthdays of your loyal customers, seasonal specials and so on. These are days when you can increase sales visibly by offering appropriate discounts in the form of percentage deductions or even free add-on services.
Be careful about discounts, though. Offering discounts is a good strategy to stimulate demand, but you need to use them with caution and limitation. Avoid offering discounts throughout the whole year and stick to the calendar religiously.
It is quite sure that you will have to raise the price of your services at a certain point in your career, but you will need to do it with care. Try to keep the price rise as minimal and unobservable as possible.
Start putting together the costs of keeping your salon running. Is it profitable? What do numbers say? Do this as often as possible to know what decision to make next. Will your prices go down or up in the next few months? Your salon’s worth will answer all these questions.
Communication matters too
Communication skills might be a game changer. Be careful to your brand presence and the way you deal with customers. Explaining your actions should be your number one priority but avoid apologizing. Instead, provide your clients with valid explanations all the time. Thank your clients for selecting your salon and don’t forget to praise your employees at all times, to encourage productivity within the salon.
Always stay open to discussion, both with your customers and your staff. No matter what the problem is, communication will surely solve the issue rapidly. Take your time to find resolutions to all obstacles that appear in your way.
Ending thoughts on salon pricing strategies
As you may have noticed, pricing is not as easy as it seems. It requires skills, patience and a lot of research. Your salon’s pricing list will determine how profitable your business will be in the next financial year, which means it will directly affect your life. Apply the pricing tips you found here, and everything should turn out just fine.
If you enjoyed reading this article about salon pricing, you should also read these:
- Tips for running a successful beauty salon
- How to make a great looking spa website
- How to create a booking website with great user experience