At the end of the day, we all want to make more money. This is especially true for salon owners. We want to be successful, and we want our stylists to make a comfortable living from their passion. Money is never an easy or fun topic, especially when you are contemplating raising your prices, which could mean asking longtime salon clients to pay more.
There are some serious fears among salon owners when it comes to raising prices. These fears are normal and rational! We fear that if we raise our prices, we will potentially lose longtime customer and won’t be able to replace them with new ones. Please don’t let this fear hold you back! If your salon continues to provide great work and fantastic customer service, you won’t have to worry.
However, that doesn’t mean you can just jack up your prices any time you’re looking to increase revenue. There are some best practices you should follow. In fact, there are two main signs you should look for to know when it’s the right time to raise your prices.
Take a look at your salon’s schedule. Out of all the available times you can take appointments, how many of those are booked? And how far out are those booked? This is your productivity level. An easy way to gauge your productivity is to download a productivity report from your point of sale (POS) system. Most POS systems should offer this. Your goal is to be booked 85 percent of the time, or in other terms, booked solid at minimum two months out at a time. Once your salon reaches this point, you can raise your prices.
2. Advanced Education.
Another great sign that it’s time to raise prices is if you, your stylists, or your salon as a whole, have invested in advanced education. If you have a technical advantage to provide – such as a new service – that no other salon in your area offers, it’s a good reason to evaluate your prices. For example, say your salon just became certified in cutting curly hair. By seeking advanced education, you have increased your salon’s value by carving out a niche that makes your salon special. This added value is a great sign it’s time to charge more.
If your salon is in hot demand and you offer services no one else can provide, go get your money! Don’t be afraid to charge what you are worth. Great hair is not cheap, and many people understand that and are willing to pay for great service.