Let’s talk about raising prices

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If you’re a salon owner, beauty therapist or hairdresser then you need to carry on reading. If you haven’t raised your prices yet, then it’s not too late. If you don’t raise your prices, then I can 100% guarantee you are going to be making less money from this month. Yes, we can always make more money and fit more clients in or extend our hours but why be a busy fool when we can just raise our prices?

Why are we so scared to do a price increase?

This isn’t anything new, most of us fear a price increase. We love our clients so much and worked so hard to build up the clientele we have that we worry if we now land them with a bigger bill, that they will leave us and go to the salon down the road, but they won’t.
Yes, someone will always say something, but you will find most of your client base will be supportive and happy to pay the extra couple of pounds a treatment.

If you haven’t done a price increase in a couple of years or more, you really need to look at all your prices and you might have to raise them quite a bit to make profit within your business.

How do I know how much to raise my price by?

Do you know your break-even points? If you don’t then you need to learn how. I teach this within my mentoring sessions more in-depth but you need to work out what you need to take an hour in your salon to make sure you’re charging correctly, covering your overheads, alongside with how much that treatment costs you to do which the supplier should be able to tell you.

Most of us will compare prices with everyone else and research the local competition. This is not the way you should be setting your prices. My overheads and money I need to make per hour is going to be completely different to anyone else’s. One salon might have overheads of £15,000 a month whereas another might have £5000 a month overhead. So how can their pricing be the same? Focus on your business only.

If you do regular price increases which would be every 6-12 months, then you will find the increases will be small and won’t affect the client at all. They get used to it and will know that’s how your business works. If you wait for years on end, you must do a much bigger increase which makes it more difficult for you as will need to do a higher jump with Is more noticeable. Don’t let this put you off but to do this now and then carry on more regularly.

How should I tell my clients?

There are two ways I recommend and can do what suits your business best.

  • Tell them in advance. You can have a notice on reception a month before the increase and send out an e-mail to pre warn them of the new prices.
  • Change with immediate effect. Most of us have online bookings now, so when a client books, they can see the price clearly. You can change all the prices online so any new bookings that come in pay the price straight away. It’s a really easy way and doesn’t make it a big deal.

In my salon we have done both ways. I always used to give a month’s notice but this year I changed with immediate effect. That worked best for us, as clients just carried on booking and didn’t even notice. Not one client mentioned about our increase, but we do them yearly without fail.

Go and study your pricelists.
Work out your breakeven points.
Set a price increase.
And implement it.

I would love to know how you get on.

Katie Godfrey
www.kgbusinessmentor.com
@kg_katiegodfrey
@kgprofessional


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