They’re No Longer Just Product Middlemen

It’s official: Nails are big business. Distributors have recognized what nail technicians have known for years. The increased consumer demand for nail care products and services has given nail technicians increased power and economic clout in the professional beauty-industry.

The growth and resulting power of the nail industry has led an unprecedented number of full-service distributors to create nails-only divisions or to become nails-only distributors. These full-service distributors, who used to carry just one or two nail lines, now offer expanded product choices and business support programs to help salons hold up against their competition and grow.

No longer just product middlemen, these distributors are forming “partnerships” with salons: They offer educational, technical, and business advice to salons in addition to providing product. Both partners profit: The salon increases its sales volume, which in turn increases its demand for products from the distributor.

Their goal, say full-service distributors, is to transform nail technicians who happen to be in business into businesspeople who happen to do nails. “Simply asking, ‘Do you need anything today?’ is not what full-service is about,” says Laurita Shat, director of the Nail Ed-Vantage division of Stardust Beauty Supply in Las Vegas. “We try to build a relationship with the technicians and find out how their business is doing, not just sell them some product.

“There’s only so much a nail tech can do,” says Shat. “She can do only X amount of work in X amount of hours, so we’re teaching her how to work intelligently and how to retail. We want nail technicians to become businesspeople like they want, not just someone with a trade.” To this end, most full-service distributors offer many of the following programs to help salons grow.

EDUCATION

Every full-service distributor that NAILS spoke to for this article offers hands-on classes free with the purchase of the product system. Classes are usually offered at the distributor’s store, although a few distributors offer in-salon education as well. “Each and every product line has technical assistance so technicians can get classes in-salon or here in the store. We also have a lending library, and they can sit in the classroom when it’s not in use and view manufacturers’ tapes at no charge,” says Shat.

Through its College of Continuing Education, Nailco in Livonia, Mich., offers 35 different courses, from hands-on product classes to management seminars. “In 1992, our approach to education has changed. Technicians no longer have to buy the kit to take the class from the manufacturer’s educator. We now offer them a broad array of techniques and classes with free education. They can purchase the systems they want after learning about the product,” says Larry Gaynor, Nailco president.

At The Nail Force, a division of Total Image Internationale in Clearwater, Fla., all products are set up on the store floor, and technicians can work with them before they buy. Joann Garrity, division manager, says The Nail Force will also loan product systems to salons that are serious about buying so they can test the product in the salon first.

While most distributors’ educational emphasis is still on product knowledge and technique, business classes are becoming increasingly popular with full-service distributors who say understanding business administration and marketing is the key to salon growth.

According to K.C. Kali, director of sales and marketing for F.H. Loeffler’s The Nail Network in Rochester, N.Y., “The nail industry is at a crucial point of reaching out and expanding. We grew and grew, and now we have to go beyond that by teaching salon owners about salon arrangements, cost of operation vs. revenue, fixed vs. flexible expenses, and how to pay their staff.”

Progressive Beauty Supply in Minneapolis, Minn., has found that business acumen is best learned in an open forum. Each month, the distributor hosts a “power breakfast” where salon owners, managers, hairstylists, and nail technicians discuss such topics as leadership, management, industry trends, how to work with a banker, etc. Attendees choose the topic and Progressive provides a speaker to lead the discussion. The distributor also hosted a six-month program on how to “recession-proof” a salon where attendees learned business finance.

Nailco also sponsors business-building classes at its twice-yearly tradeshows. Classes cover such subjects as how to build a business, motivating yourself, advertising, marketing, retailing, accounting, and the basic business principles of opening a new salon. The classes are not meant to provide a complete education, says Gaynor, but to inform the salon owner and alert her to topics in which she may need to seek more extensive education.

BUILDING A NEW SALON

The Nail Network works one on one with salon owners to help them set up their salons. “We can show them how to use space more cost-effectively and aesthetically,” says Kali. The Nail Network’s assistance can be as simple as suggesting furniture arrangements to recommendations for salon layouts and blueprints. They charge salons only if the assistance of an outside designer is required.

PROMOTION HOW-TO

Many full-service distributors are marketing experts, and they can help salons excel with merchandising and promotion assistance. In-salon representatives at Ace Beauty Supply in Atlanta, Ga., show salon owners how to increase prices without affecting customer relationships, how to display retail merchandise, and how to increase retail sales in conjunction with a nail service promotion.

“We tell them to hold promotions like ‘Recommend a friend,’ ‘Free bottle of polish with a manicure,’ or ‘Two friends, one price.’ We try and give them as many ideas as we can if we know what they want to achieve,” says co-owner Frank Cervasio.

Gladys Katsiafas, division manager of Long Island Salon Services’ The Nail Source, says they help salons educate clients about home maintenance. A well-educated client is the best prospect for retailing products. Says Katsiafas, “Technicians have to explain to clients that their service guarantee is contingent upon clients maintaining their nails at home. We teach technicians to retail items they are using and show them how to display them so the client purchases from the salon and not from the drugstore.”

The Nail Force says its new marketing center, set to open in spring 1992, will be set up so technicians can get many different display and merchandising ideas. Says Garrity, “We will display all of our products, and each section will be set up to appeal to the professionals visual sense — it will give her ideas on how to set up and display in her own salon.”

In addition to giving free merchandising assistance, Progressive Beauty Supply has numerous business-building promotion programs it sells to salons. For example, it has a customer-tracking program for client retention.

Progressive also works in conjunction with manufacturers on special offers and referral programs for salons. “With Star Nail Products, for example, we’re sending out referrals to salon clients and telling them where to go to get the product,” says Rick Goldberg. “If they go to the salon for a gel treatment, they can get $20 in free products. “We hold bounce-back promotions. If a client comes in for a manicure, we send a card to her for a free pedicure. It’s an incentive to promote the client into a newer service,” he says. “We also have a referral program. If a regular sends in three of her friends, she receives X. It’s whatever the salon owner wants to do. The new client also receives something.”

Progressive’s marketing department will design salon menus, logos, door hangers, and shelf-talkers and will completely orchestrate a salons promotion, Says Dana Schmidtbauer of Progressive’s marketing department, “Our main purpose is to ensure sell-through to the end with the service or product.

“The salon owner can say, ‘I want to do a pedicure promotion. What should I do?’ We sit down and discuss, design, and implement it.

“For example, one salon wanted to do a pedicure promotion with a winter theme. So we designed a postcard: We created the concept, copyrighted the idea, designed and laid out the postcard, and printed it. Then we’re doing shelf-talkers in her salon to promote it inside as well as outside.”

Full-service distributors often will help salons obtain sample-size products or other retail sales tools from manufacturers. Many manufacturers of professional-only nail products offer sample sizes, retail displays, shelf-talkers, and other visual enticements to help salons grab consumers’ attention. “All they have to do is ask,” says Cervasio.

KEEPING IN TOUCH

Whether you buy your product from an in-salon representative, the store, or by phone or mail, full-service distributors keep salons up to date on new products each time they place an order. And, if you have a technical question, they will find the answer.

Your full-service distributors representatives are trained to answer technical questions. “Most of the people who work for us are licensed cosmetologists. They attend sales meetings and technical classes once a week, and we always try to have an educator at the weekly meeting,” says Shat.

Three of her consultants are licensed technicians, says Garrity, and all of them can answer technical questions on the spot. “Manufacturer’s educators give them hands-on training so they have the ability to answer basic questions,” says Garrity. “If they don’t have the answer, they call the warehouse and talk to Jessica or myself.” If the distributor can’t answer a technician’s question, they will either call the manufacturer or give her the phone number.

FOR PROFESSIONALS ONLY

Full-service distributors support professionals, they say, by selling professional-only products that salon clients can’t buy at the local over-the-counter beauty supply. They also sponsor tradeshows or educational events where technicians can examine product lines, watch demonstrations, and attend workshops.

For example, Nailco hosts two tradeshows each year. At the Nail Tropics ‘91 Show in Dearborn, Mich., more than 2,700 attendees saw product lines and watched product demonstrations at more than 100 booths. The Nail Source has done shows with the National Nail Technicians Group as well as its own mini tradeshows and educational days. The Nail Network holds an educational exposition each year and is planning “pocket symposiums” for 1992 in areas that are too far from their store locations to expect technicians to travel.

Other full-service distributors hold small-scale educational events or they “sponsor” a larger trade-show by renting booths and exhibiting the different product lines they carry. For example, Ace Beauty Supply sponsored the recent Atlanta N.A.S.A. show by renting 32 booths to exhibit different product lines.

Garrity says she finds intimate “open houses” are just as successful as big tradeshows. “I rent a room at a hotel and have manufacturer’s educators there to teach. Area technicians come for the day, and there is product set up all around the room. The educators do demos, and there is a table where technicians can go hands-on themselves with some products.”

FROM STORE TO TECH

Full-service distributors will come to you in person or by phone or catalog for your order. And, if you prefer, most have one or more store locations that you can visit to see the full range of products offered and to take advantage of educational classes.

Nail Ed-Vantage has 11 store locations, says Shat, that are convenient for technicians and allow distributors to service a large area with education. Technicians can get product quickly if they are running low. Many full-service distributors also have in-salon consultants as well as telemarketing and catalogs.

While stores and in-salon consultants are the traditional means of getting product to salons, full-service distributors realize salons are in business to do nails, not run around town looking for product or waiting for a representative to come. The Nail Force has concentrated on in-salon service in the past, but it introduced its first catalog in summer 1991 and will open its first store in spring 1992.

“With telemarketing we have an 800 number, and our salespeople take incoming orders and make outgoing calls,” says Cervasio. “Each customer has a salesperson and she has a set day and time for orders. There is always, someone the salon can reach to give an order or complaint.” Most distributors offer same-day or next-day shipping, depending on what time the order is placed. Some distributors, such as Nail Ed-Vantage, have their own trucks for local deliveries.

Direct mail is another service more and more distributors are offering salons. Once a technician buys product from a full-service distributor, her name is placed on its mailing list and she receives catalogs and deal sheets that notify her of upcoming product specials regularly. Says Gaynor, “Our catalog offers 6,000 products that are pictured and described so technicians know what they do and what they’re for. They can compare products and decide which ones they want.”

ASK FOR HELP

Not all full-service distributors offer every support program described here, but most are willing to help in any way they can. But until the salon asks for help, says Shat, the distributor is powerless. “It’s frustrating to tell someone these services have been here all along and have them be flabbergasted.”

To start getting more out of your distributor, Goldberg advises you to first look for a full-service distributor in your area. A salon in California, for example, cannot take full advantage of what a full-service distributor in New York offers. Some full-service distributors discourage technicians from ordering product if the technician is outside the area.

Says Kali, “I may be able to sell a product to a technician cheaper than another distributor in her state, but that’s not the concern. We will refer someone from Michigan to a distributor there because I can’t give her the education and other things she will need to become successful.” Some full-service distributors, such as The Nail Network, which serves upstate New York, serve a small geographic area. Others, like Progressive Beauty Supply, cover several states.

Next, says Goldberg, “I would create a mission statement for my salon that identifies who, what, and why I am. ‘I don’t just do nails, but I am in the nail business to ...’ I would check new products to see if they support my mission. Then I would ask the distributor, “What program do you have to sell me through this new sculpting system? Also ask, ‘Now that I like the product and my people are trained, how do I sell it to the client?”

Goldberg recommends translating the general desire to build your business into specific goals. If you want to increase pedicure sales, for example, ask for promotion ideas, special product packages, and retail product samples for pedicures.

NOT AS EASY AS IT SOUNDS

Although full-service distributors offer a broad base of business-building programs, they are not without fault, say technicians. Of the 28 technicians NAILS polled for this article, many complained that full-service distributors are inconvenient to reach, have high prices, limited selections, or back-ordered and understocked products. NAILS asked full-service distributors for their response to these complaints. Here’s what they said:

Complaint: It’s not always convenient to order product from a full-service distributor. Sometimes I need product this afternoon.

Responds Katsiafas, “As a businessperson you know you cannot work without powder and liquid. So know what you have in inventory and don’t open your last bottle before you have another one. You never know when you’ll drop the one that’s in your hand, and you may be using a product that you can’t get at the beauty supply down the street.”

Shat agrees, “Technicians need to realize they are in business. Their responsibilities are knowing their trends in bookings and knowing to increase purchases and keep some backup on hand. Learn how to order a little more in advance.”

Complaint: Professional-only suppliers charge too much.

Goldberg discounts this argument easily. He says, “They aren’t getting the value they need from the distributor. I don’t care what it costs; I want to know what the value is. Nail technicians will make the investment if they see what the quality is. There is always someone who’s going to sell a product cheaper. The bitterness of low quality lingers after the sweetness of cheapness is forgotten.”

Other distributors argue that they just charge the manufacturer’s suggested price. “OTCs normally don’t have a sales force and they don’t have to pay commissions or for store areas, banquet rooms for education, a marketing center, telemarketing,” says Garrity. “We’re not charging more, we’re just charging the suggested price. OTCs don’t have as many expenses and they can afford to undercut the full-service distributor.”

Complaint: Professional-only distributors have limited supplies and selections.

Responds Goldberg, “That again is built into the value issue. All the products being offered are good quality. The manufacturers know how to make a good polish, good powder, and good boards. Look at the programs being offered, and the product becomes almost secondary. If I can offer you a new service, doesn’t that have value too?

“I don’t know that there have been any revolutionary new products introduced. As a full-service distributor, I have programs and strategies that help you hold up against the competition. I have as great a worth to you as a particular product,” says Goldberg.

Kali agrees, “I think we have about everything the nail artist is looking for. We carry the manufacturers’ full line. We carry all product systems and for almost everything we carry we have a choice of two different manufacturers.

“By carrying every manufacturer, we would be confusing the nail technician. This way, we can do justice by staying focused on lines we really believe in.”

Complaint: They are frequently out-of-stock or back-ordered.

“Inventory control is hard. You never know unless you have very good tabs on what’s selling. We can have something here for a long time and it’s moving slowly, then all of the sudden there is a great demand,” says Garrity. “It’s been a growing pain for all nails-only divisions.”

Says Cervasio, “You never know what to buy. I ordered 144 Creative Nail Design [holiday] deals. Our catalog was out November 1, and I was out November 2. I’m going to get more in but it’s currently back-ordered. I try to estimate how something will sell, and sometimes I miscalculate.

“If someone orders a 4-oz. liquid or powder and we have to back-order, the order taker must get the salon’s okay to substitute with a smaller or larger size. Rather than shipping nothing and having them ready to kill, they can get something so they’re not facing a busy weekend with no product. This has stopped 90% of our problems,” says Cervasio.

WORK SMARTER, NOT HARDER

Their objective, say full-service distributors, is to show technicians how to make more money without increasing their workload or hours. “If product is all we’re going to give them, we’ve gone as far as we can. Unless we continue to educate, technicians will only be price oriented and will go no further,” says Kali. By promoting support programs and business-building tools, full -service distributors hope to emphasize the business aspect of doing nails.

Quite simply, knowledge is the most valuable commodity full-service distributors can provide salons. Says Goldberg, “Things are constantly changing, and to stay competitive in any industry you need to know what is new.”

WHERE DO TECHNICIANS WANT TO BUY PRODUCT?

In a random survey, NAILS asked 28 technicians where they really want to buy product. Some technicians currently buy product from more than one source.

	If you could buy product from one source, where would it be?
	Full-service distributor/Professional-only supplier	79%
	Over-the-counter beauty supply	11%
	Manufacturer-direct	7%
	Tradeshow	4%
	Where do you buy your product now?*
	Full-service distributor/Professional-only supplier	63%
	Over-the-counter beauty supply	22%
	Manufacturer-direct	15%
	Tradeshow	4%