You may not know, but... previously we had two salons, knowing our industry so well and how tight it can be at certain times, we decided to share five ways to improve your salon profitability in 2023 with guidance and tips to help you continue growing as a business during these slightly turbulent times. These are some of the ways which helped us grow our salon, increase our profitability and gain more success so we thought we'd share them!
How to improve profit & make more money in your salon…
- Grow your client base.
The ultimate way to generate more profit is simple…You need to get more clients into your salon and ensure you keep them. The cost of acquiring new clients is high, and you will likely need to focus your attention on marketing along with some special offers to get new faces through your doors.
Here is an example of how one new client in a month can generate a healthy profit…
- Imagine you have a new client who books in for a cut and finish for £40.
- If they returned for five more appointments that year, you’ve generated a total of £200.
- If you aimed for a target of ten new clients in a month, all of whom remain repeat clients, this could end up at £2,000 worth of new income.
- If you achieved this every month, that’s a boost of £24,000 over a year!
- On top of this, you could also make more revenue from upsells, cross-sells and retail sales.
Salon booking apps
It may also be worth considering introducing new booking methods to make it as easy as possible for new clients to make appointments with you. If you don’t have one already, you could set up an online booking feature on your website, or consider using a salon booking app service such as Fresha. Not only will a salon booking app take care of clients making their appointments, but some systems also allow you to send text or email reminders to your clients whilst working as a client information database.
Expand your salon services
Expanding your salon offering can also help to attract new clients. For example, have you considered testing out the demand for vegan salon treatments in your area? You may want to survey your existing clients to gauge interest in new services and gain feedback on what treatments you could also be offering.
- Increase the amount of money your clients spend per visit
Along with increasing the number of clients you have on your books, the next best way to improve your salon profit is to increase the amount of money your existing clients spend on each visit. It’s well known that your most loyal clients are more likely to spend more with you. So again, building a relationship with everyone who visits your salon is vital.
Salon retail add-ons and upsells
If you want to boost your profits from each treatment, consider what you are upselling. Services such as a nourishing hair treatment at the backwash can add extra profit to your takings.
Don’t forget the importance of salon retail as a revenue stream. If you think you could increase your retail sales, set yourself a daily or weekly target and train your staff on how they can help achieve it. Consider putting time into how you merchandise your salon retail offering to make it as attractive and readily available as possible to your clients.
If you are interested in changing your product line, don’t forget we offer OWay, KYK Hair Care, AlterEgo and Insight – click here and send us a message if you’d like know more.
Revisit your pricing
Finally, look at your pricing. Does it need to change? You may have upgraded to better, more expensive products or your reputation may have been growing. Have the confidence to raise your prices if you need to increase your profit and the demand for your salon is there.
If your clients are all delighted with the services they receive, they should be more than understanding. If any clients aren’t willing to pay more for your expertise and talent, it’s more than likely that you will attract new clients who are.
- Encourage your clients to visit your salon more often
Just as you want to get as many repeat clients as possible, you also want to maximise the number of times they come to your salon. The more they return to you, the more profit your salon will make. Make sure you ask every client if they want to book their next appointment before they leave, and don’t underestimate the power of introducing client loyalty schemes along with recommend a friend schemes.
Another suggestion would be holding a client event in your salon to get the word out there and encourage people to bring family and friends. If people can see your beautiful salon, meet some of the staff and see how dedicated you are to providing a fantastic salon service experience, they are much more likely to try out your services.
- Reduce your salon overheads
The other points we mentioned are about attaining more revenue to add to your profit. But, equally important is to take away anything that is eating too far into your profit margin.
At some point during every year you should analyse all of your overheads and identify any points of unnecessary spending. Always check that you are getting the best deals for your fixed costs, such as energy bills and insurance.
See if you can make any changes within your salon to help reduce your energy bills, for example switching to EcoHeads for your back wash will reduce the amount of water used in your salon and in turn help reduce your costs.
Break down each area of spending by percentage so you can keep track of any areas that are creeping up. For example, staff should cost no more than 60% of your turnover. If this number starts to creep up, consider why – do you need to train your team on retail sales? Or do you have too many unfilled appointment slots?
Be aware of how much stock you order. Over-ordering can disrupt your cash flow and make your storeroom untidy! Order what you need weekly or monthly and do regular stock checks to ensure your spending is as efficient as possible and that you have the correct stock in required for that week/month.
- Utilising social media
We’ve hit that era…
It is essential to make sure your salon business and work is getting in front of as many people as possible. We highly recommend utilising the power of free social media platforms such as Instagram, TikTok and Facebook to produce content that will make people stop what they’re doing and pay attention to you. Whilst you’re on make sure you give our account a follow @prostylinguk