If you’re reading this article, you must have thought about starting your salon. Salons can be great places. You’re constantly meeting new people and you get to try new styles. However, there’s no point in starting a business that won’t make money. So, the question is, how do salons make money and what can you do to make even more?
Salons make money in two principal ways. The first way is through offering services to customers, such as haircuts. The second way salons make money is by selling products. For salons to make money, they offer more services, make their services easy to get and provide hard to get services. Salons also make money by advertising salon products, upselling products, and offering a greater variety of products to sell.
Making Money Through Services
If you want to start a salon that makes money, there needs to be something about your services that draws people to them. The three major ways your services can better draw people to your salon are by offering more distinct services, being more diverse than other salons, or being easier to access and book an appointment with.
Being More Distinct (Being Niche)
When you are a niche hair salon, it means that you cater to a certain type of style or even a certain type of individual. This could mean several different things, it could mean you focus on one specific type of salon need, such as haircuts, or it could mean you focus on a certain type of individual.
One good example of a niche is children’s salons. The focus primarily on catering to the needs of children. Another interesting niche would be a salon that caters to styling for high school dances like prom.
If you don’t want to limit the people that will come into your salon, then you can focus on offering one specific type of service and being the best salon to go to for it. For example, if you have a stylist that is extremely well trained in dying hair and giving highlights, then you can have your salon focus on only doing dye jobs, but the best dye jobs around. Having a brand presence of being the salon to go to for such needs can help your salon make money.
Offering More Services
If you feel nervous about specializing in your salon, then you can go in the opposite direction to make money. Instead of catering specifically to one group of people or only a handful of services, you can have your salon offer as many services as possible.
The most common example of such a setup is an all-purpose salon. Such salons will offer their patrons the ability to get haircuts and dye jobs and then move to another part of the salon to get their nails done.
Many potential customers will like this setup because it saves them the time of having to go to another store to get those services taken care of. On the flip side, such setups do tend to be more expensive to maintain. However, offering multiple services allows you to get more customers, which means your salon will be making more money.
Easier to Access Services
If you find yourself being unable to offer the best niche services and unable to offer the biggest variety of services possible, then just make your services the easiest to access. This can be done in a few ways:
- Have easy-to-use appointment software. If it is easier for the customer to make an appointment with your salon than competitors, then they’ll come to you and you’ll make money.
- Make your salon more financially accessible. People at almost every price point need access to a salon. Many people will be very appreciative if you can offer a great salon experience on the cheaper end, even if there aren’t as many services to choose from.
- Set up shop somewhere convenient. Location is key, especially if you’re trying to attract certain patrons. If your salon is located right next to a dress shop, then girls going to prom can leave the shop and immediately see your salon. Put your salon somewhere your desired customers frequent, and you’ll start making money.
Making Money Through Products
Making money through your salon’s services is only half the hustle. A significant amount of your salon’s income is going to come from the products you sell in your salon. These products are typically the ones you’ll use when you’re servicing your patrons. If you can upsell and advertise the products well, your salon will make money. Also, offering a wider variety of products will help the salon financially.
To upsell a product means to encourage a customer to buy a more expensive version of a product. Doing this helps your salon make money.
While you might feel slightly uncomfortable encouraging your customer to buy a product purely on price, it’s not something to feel awkward about if the product is truly good for them. If you have products that are more expensive but work wonders, then you should encourage your customers to buy them because it will give them their desired result.
Another method to sell products that accompany upselling is cross-selling. This means that you’ll offer customers a product for a different purpose than the product they’re already planning to buy.
Say, for example, your customer wants to buy tinting shampoo. First, you offer them a brand that is sure to give them their desired results. Then you mention a hairspray that is known to be good for preserving color.
If you aren’t comfortable with upselling, then cross-selling is a great alternative as long as you stick to products the customer will need. While the customer might not have been looking for hairspray, it is most definitely a necessity if they have long hair that they often put in ponytails. It’s all about anticipating the customer’s needs and providing a solution before they realized they needed one.
Advertise Your Products
Never underestimate the power of advertising. Some companies make most of their money right after pushing a successful advertising campaign. Advertising your products well throughout the salon is sure to make you more money. There are many ways to advertise your products.
- Put up posters. People tend to look around while they are being taken care of at salons. If you have posters plastered around products you want to sell, customers might see them and be interested. If you’re doing such advertising, the posters need to look appealing.
- Use the products. This is possibly the best advertising you can do at a salon. If the customer likes their look after you’ve used the product, they’re likely to want to buy it.
- Getting your stylists to talk up products. Some people come to a salon, talk a little with their stylist, then zone out. If you can get your stylists to talk about the products while they’re using them, you’ll have given a little advertisement pitch to your customer without feeling too overbearing.
- Leave the product in plain sight. This method works especially well if the product has clear and enticing packaging. Younger patrons are sometimes willing to buy products simply because they look cool in their packaging. Allowing them to look is free and effective.
Advertising is an especially useful tool if you have the excess product you’re trying to sell. Use it with more customers or put it out in the open for viewing so the product has a chance to help your salon make money.
Offer More Products
This method of making money can be a little trying if you’re already on a tight budget, but the principle is the same as offering more services. Offering more products gives your customers more opportunities to spend money while they’re in your salon. If you’re willing to spend the extra cash to start product expansion, here are a few ideas for expanding your product line:
- Offer gift cards. This option is great because it’s relatively cost-effective, and it makes sure that the customer comes back to your salon. It’s also a little bit of free advertising.
- Offer products with the salon’s logo. This is a great idea if your salon has a great logo. If the logo is cool enough, it could start a trend that will bring more traffic to your salon. Some items you can put your logo on our caps, T-shirts, and the like.
- Offer different brands. Offering more brands can be a little complicated. If you offer too many, the customer can feel overwhelmed and not buy any. However, it might be a good idea to add one or two more brands for your products.
Remember, sometimes less is more. If expanding your product line is not possible right now, using the other options above to make money for your salon would be best.
Check out the salon trends you MUST know HERE!
Where is the best place to open a salon?
This question can be a little tough to answer. In terms of making money, states like California and New York will probably allow Salons to make the most money. However, all the other costs salon owners have to face, such as rent and price of products, are much higher in those states.
If you’re looking for places where your dollar will stretch the farthest, then opening a salon somewhere in the Midwest would be a good choice. Technically, you won’t make as much money, but the cost of living there and rent is so much lower than ultimately, you’ll be living more comfortably than in a state like California.
How much money do stylists make?
Again, this question depends on where you live and what kind of stylish you are. Hairstylists can typically earn anywhere from $8.50 an hour to $24.50 an hour, but of course, there are outliers. Smart stylists that own their salons can make six figures. It all depends on where you live and what kind of stylist you are.
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Please note: This blog post is for educational purposes only and does not constitute legal advice. Please consult a legal expert to address your specific needs.
Shawn Chun is an entrepreneur who has owned several types of businesses from a coffee shop to an import and export business to an online review business plus a few more and now creates online resources for those interested in starting a salon business. It is demanding work he loves to do it. Shawn says “I do it for those passionate about their business and their goals. I know how hard the struggle is to obtain and retain clients, finding good employees all while trying to stay competitive.”
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