Money Matters

Do Your Prices Need a Makeover?

Many of you are concerned that when an increase is implemented, clients will leave, and in some instances, this may be true. But you must not forget future goals, and you must keep pace with increases in supply costs, education expenses, and other overhead cost expenses.

Many salon owners and booth renters hesitate to raise prices. Many of you are concerned that when an increase is implemented, clients will leave, and in some instances, this may be true. At one point, you came up with a service charge that allowed you to meet your financial goals at the time. But you must not forget future goals, and you must keep pace with increases in supply costs, education expenses, and other overhead cost expenses.

Review your overhead expenses twice per year. Performing a review will allow you to see which expenses have increased. Have you discovered that certain products increased beyond a comfortable level? The services using products that have dramatically increased in cost warrant a price increase. For instance, have you purchased a more expensive manicure or pedicure system and continued to charge the same price? Project additional increases for these services, and then raise the price of that service to cover future costs and raise your profit level, while retaining satisfied customers.

Still hesitant about raising your prices because you are afraid of losing clients or revenue? Consider whether you are booked solid. It is great that you are in such demand; however, unless you plan your work hours to include breaks, you may be headed for burnout. How can you allow yourself more time without sacrificing income? Let’s say that during a 40- hour week, you service one client per hour, and charge $25 for a fill. Your gross would be $1,000 for that week. Raising your price 15% would allow you to earn an additional $150 a week. You could afford to lose six clients, and free up some time while maintaining your weekly income.

Another simple guideline in raising prices is to determine how many of your available appointments are consistently booked. Determine how many appointment hours are available per week by dividing the number of filled appointments by the number of available hours. If the number is higher than 85%, you should raise your prices. This is the level at which appointment problems arise — you are unable to service clients for repairs, to change their appointment times, take periodic breaks, and make or return phone calls. This is how I arrived at my price of $80 for a full set, and $45 for a fill, while my “competition” was still charging $25 for a full set, and $12.50 for a fill.

Many nail technicians and salon owners fear raising their prices because the salon down the street charges far less for their services. Does the competition perform at your same level of expertise? Are they using the same product system available in your salon? Are they practicing high levels of sanitation? Have they participated in continuing education, won awards, or specialized in certain services? Another thing to take into consideration when raising your prices is to ask yourself the question, “Are my clients coming to me because of my low prices, or because they receive excellent service at a reasonable cost?” Over the years I have come to realize that consumers can be placed into two main categories: Those who strictly price shop, and those who value shop for quality. Those in the second group will determine if the quality they receive is worth the price for any given item or service. However, in order to justify your service charges, you must maintain your high level of skill and professionalism.

Marti Preuss is an independent educational specialist, national competition winner, former nail technician, and former educational sales consultant for Creative Nail Design. Her informational website is www.hooked-on-nails.com.  

Keywords:   raising prices     service pricing  

Leave a Comment

Name:
Email:
Comment:
Submit

Comments (0)

Subscribe to NAILS & SAVE!

Get a free preview issue and a Free Gift
Subscribe Today!

Please sign in or register to .    Close
Loading...
 
Subscribe Today
Subscribe Today