Beating costs to boost profit

Few industries tolerate a charging model that makes a mockery of profit predictions, yet hairdressing is one of them. When following a traditional fixed price per service pricing model, costs are variable regardless of hair type, thickness or porosity, and so are profits. However, recent research published by Vish has found that salon owners have had enough of costs eroding profitability, especially in light of out-of-control energy costs and soaring inflation. They are seeking new ways to charge their worth.

Price for profit

Vish has published its findings as a White Paper – Does Time-Based Pricing Make Sense For Your Salon?  which drills into the benefits and drawbacks of three historic pricing strategies. The intention is to help salons understand what pricing model best suits their unique goals. Salons can even opt for hybrid models by using technology that ensures profits don’t dip below a set average.

Vish is sharing its findings further with a Facebook Live session at 5 pm on 24 October on @vishsalonsuk. Join Tim Howard, Chief Innovation Officer of Vish along with two successful salon owners who have leveraged Vish’s technology to help cut colour costs, maximise colour revenue, and price effectively.

Capturing real costs in real time

“The introduction of technology offers next-level transparency for salons, with consistent and simple price management now within reach,” said Tim, a former salon owner himself. “With Vish, colour costs are recorded as the colour is dispensed, making it possible to approach charging in a way that guarantees profit while creating an equitable pricing structure for clients.”

The White Paper shows how the traditional all-inclusive method of charging, in which every client is billed the same within a service even though they may have very different hair needs, opens salons to unpredictable margins which erode salon profitability. The alternatives of parts and labour and time-based pricing were revealed to offer greater stability, while the built-in product allowance feature was also found to help salons reduce colour costs and retain profit.

Transforming the colour business

G&E McIntyre’s, in Northampton, is a Vish salon using the time-based pricing model to eliminate guesswork, reducing its waste from 37% to 8%, yielding a decrease in overall colour costs.

“We started working together almost overnight when Vish was nominated for Innovation of the Year by the British Hairdressing Awards the same year we won for Customer Service,” explains G&E McIntyre’s owner, Gavin McIntyre. “We met Vish Managing Director Tom Bentley-Taylor at the awards and he explained what Vish does. We took a closer look, and within a matter of weeks we’d transformed how we managed our colour inventory and usage and, ultimately, our pricing.”

Vish’s research illustrates that Gavin’s salon is far from an isolated case. As more salons seek ways to secure profits during these incredibly challenging times, it’s become evident that taking control of colour is the first place to start. For more information on how you can take control of your colour business, download the Vish White Paper and join Tim Howard, CIO of Vish on October 24th, 2022, @ 5 PM BST for the Price For Profit Facebook Live @vishsalonsuk.