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How to raise salon prices without losing business

By Meg Crane

0107

It’s important to raise salon prices, but it can be tricky to decide when, by how much, and how to let clients know. There are a few ways to go about this and salon owners must decide what works best for them.

“The rule of thumb is in the spring, raise haircut prices, and in the fall, raise colour prices,” says Kitty Bernes, owner of Berns & Black Salon & Spa, who increases her salon prices by one or two dollars each year. A few months before prices are going to be raised, stylists should let clients know the exact date it will happen. “Most people are like ‘meh.’”

The early warning gives clients time to adjust to the price changes and either financially prepare or set up an appointment with a junior stylist at the salon.

“We have a level system in place,” says Lindsey Kellett, co-owner of The Salon Professional Academy Winnipeg and Shear Style Hair Studio. There are four levels at her stylist school and six at the salon that are based on years of experience and the stylists’ level of education. The price raise is four dollars per service, which allows for a wider economic range of cliental. “I really don’t find our clients have a problem with it,” says Kellett about raising prices.

The announcement usually comes in the form of a certificate and announcement being posted on the wall focusing on the achievement of the stylist who will receive a promotion rather than the increased cost to clients, which makes it a happy celebration. Kellett compares price increases to the salary raise someone would get when they finish their PhD, and said it is like a promotion for a stylist.

Kellett admits she has an anxiety attack every time she needs to tell clients about a price increase. She said her stylists, particularly those who have been in the industry a long time, are often reluctant to raise prices as well. This is because of the personal relationship stylists often develop with clients.

“We touch them all day and typically get pretty close to them,” she says, adding that it can make it difficult to ask for more money. But it’s important to try to stay professional and Kellett suggests mentioning price increases to clients when they are “under the cape”.

“Our salon prices have been frozen for the last two years,” says Michael Larocque of HairFX. This is because the recent PST hike means that clients are already paying more at the till without prices themselves rising, and Larocque doesn’t feel it’s fair to make clients pay that much more.

In the past, Larocque has not had many clients who were upset with the one- or two-dollar price increases. However, he said some clients may be lost when prices go up.

“It’s best to do when you need to filter your client base out,” says Larocque, such as when a salon is having a hard time fitting in clients and has a long waiting list. Larocque says a salon needs to earn the right to raise prices through years of service, building a large client base and achieving a high level of education. He sends his staff to take classes in Toronto so they are highly educated hairstylists who can better serve his cliental.

There is no one right way to raise prices, but it is important for salons to find a way that allows stylists to increase their pay without losing too many clients.

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