Business Management

Asian Influence: Building A Bridge

As competition increases, the gap between Asian salons and the rest of the industry is actually getting smaller. To keep their English-speaking clientele, Asian nail technicians are making efforts to learn the language and expand their salon services, while non-Asian salons are discovering the value of quick service and client convenience.

“Asian salons have tapped into the needs of the typical American woman, who wants her nails done in 30 minutes,” adds Gaynor.  “Price is not the issue; it just happens to be the benefit.  If they’re charging $25 for a set of nails in 30 minutes, that’s no different than paying $50 for a set of nails applied in one hour.”

“Forget the price,” agrees Harriet Rose, CEO of Forsythe Cosmetic Group (Lawrence, N.Y.).   “They reason Asian nail technicians do so well is because they’re very hard workers.  You don’t need an appointment; they never say no.  If you call to get your nails done and it’s 10 minutes until closing they say, “Come in!”  They’re very customer service-oriented.  Women don’t go to a salon just because it’s $2, $5, or even $10 cheaper.  Convenience is the key.  It’s that they can get their nails done at any time without an appointment.”

Salons offering convenience at an economical price present a tough package to compete against, but it’s what nail professionals today must do survive.  “Perfect your skills,” advises Gaynor.  “You don’t have to cut corners or eliminate customer service to do nails faster.”  Just ask Blythe Albert and Sherri Isley, co-owners of Expressly Nails in Washington, D.C.   “Our clients want a fill in 15 minutes.  They want wham-bam service but they don’t want it to feel like wham-bam.  We have conversations and carry them over every two-week period.  Nothing takes us more than 45 minutes,” says Albert.

There are also ways to make your salon more convenient to clients.  If everyone in the salon has a full book, you can add a new technician who wants to build a clientele and advertise that you take walk-ins.  Put a sign in the window, then tell your regular clients and everyone who calls that walk-ins are welcome.  Add “Walk-ins Welcome” to your ads in the phone book, newspapers, and direct mail fliers.

Develop a mentor program or training procedure that pairs an experienced nail technician with a junior one, so that the trainee quickly picks up the skills by working closely with the senior.  Hoang says this is how Asian technicians work” “In Vietnamese salons they have mentors who teach them their techniques.   They have a very good system of working with each other.  There’s no competitive feeling of ‘If I teach you you’ll take my client.’”

For the salon owner, it’s a control issue.  Nguyen explains: “To keep up the salon and have everyone following the same systems, they have to be employees.”  Then they come to work at a specific time, follow our procedures, and use our products.  They don’t have a problem working together and they help each other.  It’s a family type of thing: I help them and they help me.

“In booth rental the attitude is, ‘It’s your customer, you take care of it.’  I wish I could run a booth rental salon so I wouldn’t have to worry about the business, but I want control of my business so I’ve made all my workers employees.  I want everyone using the same products and following the same procedure,” he says.

Salons can also learn from what discount salons are not doing.  “We do two-tone acrylics, which the discount salons don’t do.  Two-tone acrylics account for 97% of our business; our clients can’t get them at a discount salon,” says Nguyen.

“They don’t see the benefit in doing paraffin dips, or they don’t have the knowledge they need to offer it because they weren’t taught how,” says Ho-Wah.  “Schools aren’t teaching them how to do waxing or sea-salt pedicures or fiberglass wraps,” she continues, “but eventually all salons will have to expand their service menu to include these special services.”  If a salon uses price alone as its competitive edge, then it simply must keep its amenities to a minimum as well.

Gaynor advises salons to do whatever it takes to make their salons competition-resistant.  “Look at bagel stores and coffee shops, for examples.  There’s a bagel store on every corner, and for years Dunkin’ Donuts was the place to get coffee and a doughnut, then all the sudden Starbucks appears and now there’s a coffee shop on every block.  No one goes to Dunkin Donuts for coffee anymore.  Then bagel shops open everywhere and no one goes to Dunkin’ for doughnuts anymore, either.  That’s because in the past there was only Dunkin’ so what they offered was O.K.  But now there’s a choice about where to go and what to get.   So what should Dunkin’ do?  Add bagels and flavored coffees.

What Does the Future Hold?

“Even though there are two market segments, we’re all doing nails.  Unfortunately, one segment has very limited information and another has abundant information,” explains Hoang.  “You find most Asian nail salons offer mostly acrylic nails, nothing else.  If you are an Asian nail technician, what do you do then to attract the customer?  Either offer additional services—but you can’t because you don’t have the knowledge—or you lower you prices.  That’s why prices are so low—they have such limited information.  American salons offer a variety of services.  Whatever a client wants, they have.  These salons do gels, they do waxing.  Those are additional services and the prices are fixed, not discount.

“We need the industry to pay attention to the Vietnamese market to help them achieve what they need and to help the industry in general.  There are two markets with different prices; somehow we need to unite them, and that means unite the segments.  We need to give them information; push up their knowledge.   If we can do that we can push up the prices, improve their sanitation standards and knowledge of nail disorders and how to work with drills.

Most industry watchers see these changes already happening.  For their part, Vietnamese salons have watched prices fall so low that certain areas of the country are no longer very profitable places to run a nail salon.  There is a migration out of the large metropolitan coastal cities like Los Angeles and New York, to areas of the country where nail salons are less common.  Within the Vietnamese community there is much concern about the continuing downward spiral of service prices.  No one, it seems, wants prices to go any lower, and most want them to begin to move back up.  There are signs of a growing awareness of how to do that.  Manufacturers say they’ve seen an upswing in class attendance by Vietnamese nail technicians, and they’ve also noted a growing interest in “alternative” nail services that allow salons to seek premium prices.  Light systems, for example, are enjoying popularity in Vietnamese salons, which charge $2-$5 more for light-activated systems than traditional acrylic procedures.

Last month, in part one of this article, Vietnamese salon owners Peter Ha, My Kieu Huynh, and Trang Nguyen talked about how they have had to evolve from what was considered a “traditional” Vietnamese salon.  Huynh started out as a low-priced salon to compete, then decided to go upscale with her services and prices to survive.  Huynh and the others are the front wave of a new generation of Asian salon owners.  They understand the industry, the culture, and the business world and have repositioned their salons to maximize their potential for profit and success.  Not only that, they are expanding into other areas of the industry.  Ha owns five beauty supply stores in several states and has plans to open more; Nguyen plans to capitalize on his reputation as a top competitor by introducing his own line of acrylics marketed to Asian salons; and Huynh plans to continue growing her successful salon chain.

Salon owner Maria Hamim, who owns four salons in Arizona, says that although her prices are currently considered “discount,” she plans to change that, as well as the salon chain’s identity.  “I want our employees to be more customer-oriented and spend more time on the hand massage.  We try to differentiate ourselves with the products we use.  Now that there are a lot of Asian salons around, I’m trying to push things to be different.  We try to keep the talking Vietnamese down, and the technicians try to speak English to their clients, who appreciate the effort.”

These are the people who will continue to shape the future of the nail industry.  As the generation of Asian immigrants becomes more established, their salons will become increasingly mainstream and their acceptance more widespread.  Their success—and their failure—will lead them toward the same values embraced by all nail technicians and salon owners of every nationality: increased prestige, customer retention, technical excellence, and financial success.

 Is Lack of English a Barrier?

“Ninety-nine percent of our students are Asian,” says Minh Naht Trieu.  “The percentage who speak English is 30%-33%.  Most of them are newcomers to the industry and haven’t yet learned English very well.”

Almost immediately the lack of English skills works against many Asian nail technicians because only three states (California, S. Carolina, and Washington) offer the state board examination in Vietnamese (Vermont requires students to call about other language tests).  While some allow the use of translators (only 10 states allow an interpreter into the exam and four specifically require pre-approval), “this gets into problems with the validity and reliability of the testing instrument,” says Debra Norton of the Arkansas State Board of Cosmetology.

Says Elaine-Ho-Wan, “Non-English-speaking students can’t really understand the nail diseases and disorders taught in the books.  Whatever they learn while they’re actually in class is all they get.”

Trieu and Pauline Herr speak only English while teaching their classes in an effort to keep students learning their most critical skills—to communicate with their clients.  Herr, who doesn’t speak Vietnamese, has an “incentive” for students to speak English only: “They speak English on the floor or they have to put a quarter in the jar.”  By the time her first class graduated, Herr says they had made good progress in mastering the basics of English.

“Immigrants have limited language skills,” cautions Dan Hoang.  “They can communicate in daily conversation, but not intellectually.”  If English-speaking students don’t graduate salon-ready, how ready can a non-English-speaking students be, he wonders.

Does the language barrier affect Vietnamese nail professionals once they begin work in the salon?  “I don’t think so,” says American-born Maria Hamim.  “Clients just want a smile and some basic conversation.  I have noticed in our salons that when technicians talk to each other in Vietnamese, clients don’t know if they’re talking about them.  A lot of clients come here because they want to be relaxed so we try o keep the talking down.  Clients are really nice if you try to speak in English.”

“That’s why they come into the nail industry,” says Trang Nguyen, “because they don’t have to speak English.”

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State Boards See Link to Licensing Fraud

Although most state boards don’t track the ethnicity of licensees and therefore cannot provide data on ethnic breakdown in their states, many will say that they’ve noticed an alarming trend.  With the growing number of Asian nail technicians has some an increase in unlicensed activity and fraudulent applications for licenses.

“The biggest problem [state boards] have had is fraudulent documentation and people going into schools, completing the training, and taking the test for someone else,” explains one state board director who asked not to be named.  “That is a real problem; I don’t think it’s limited to Asian community, but it’s more prevalent in that segment.”

Other forms of fraud seen more recently include schools “selling” hours, cheating on the exams (stand-ins taking the test and interpreters providing the answers, for example), or using someone else’s school documents or identification to apply for reciprocity.  One school in Louisiana was called a “diploma mill” by the state board for falsely certifying hundreds of students.  One student, who never attended a single class, paid $1,600 for her certification from the school.

“Some 95% of those certified by the school to the board…were of Vietnamese extraction, many of whom spoke little English,” explained the Louisiana Inspector General’s recently issued report on a cosmetology school in New Orleans.

In Wisconsin, salon and school owner Jan Studesville says she received a distress call from another school owner: “She’s in town on the Illinois border and she says she’s been getting calls from Vietnamese who want to know how much it would cost them for her to sign the papers to take the exam!”

Denise Brown of the California State Board of Cosmetology says the board now provides the written portion of the licensing exam in Vietnamese because of the numerous “incidents of cheating.”

But the biggest problem of all is fraudulent documentation, says Sue Sansom of the Arizona Sate Board of Cosmetology.  As a result, she says, the Arizona Board no longer accepts certification of school hours directly from the school; all certifications must come from the licensing state board.

“We have found people buying certifications, we’ve identified some schools doing it, and have found doctored certifications.  The board took another giant step recently by instituting a requirement for photo ID for all applicants.  We will process paperwork for applicants from out of state, but they have to pick it up and we have to verify their ID.  We were having people drop off papers for 10 people on the same day they were picking up papers for a different set of people,” Sansom explains.

Many state boards are being forced to show down their reciprocity procedure to take the necessary time to review and authenticate documents.  The sheer volume of applications for reciprocity was overburdening state board administrative staffs.

Debra Norton, executive director of the Arkansas State Board of Cosmetology, says her office now interviews in person everyone applying for reciprocity and goes through licensure requirements.  And, like Arizona, Arkansas now has stricter documentation requirements.  “The interview process puts a real strain on the staff,” says Norton, “but we see every person who comes for a test, so why wouldn’t see anyone coming from another state?” [Fraud] could have been a problem for years, but we will never know.”

While all of the state boards executives we spoke to for this article emphasized that licensing is a fraud is not exclusive to Asian applicants, they all admitted that there was a remarkable correlation.  Most of these officials also disclosed that a significant proportion of the cases they have investigated for fraud have involved Asian applicants.

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Service and Retail Industries Both Bloodied in Price Wars

If it’s any consolation, the nail industry isn’t the only industry that faced price wars and oversaturation.  The retail and service industries have had “shakeout periods” borne of intense competition and price-cutting.

Department stores, specialty retail stores, and even the popular mass merchandisers like Wal-Mart and Kmart are being squeezed as new shopping centers spring up on every corner and in every empty field.  Today’s price-conscious consumer got her training at discount warehouses like Sam’s Club and Price Club/Costco in the early ‘80s.  Department stores and specialty stores suffered, especially those that didn’t create a compelling identity for themselves and couldn’t compete at the same price level.

To maintain profits as they lowered prices, discounters and mass merchandisers had to slash their operating costs.  Eventually, there was no more fat to cut, and yet retailers couldn’t raise their prices because they had trained their customers to be highly price-sensitive.

In an effort to sustain their growth, they expanded to new neighborhoods, new cities, and new states.  By the mid-‘90s there was a glut of retail stores and everyone suffered; today many retail chains are closing stores and some have been forced into bankruptcy.  The retailer hurt the most didn’t create a strong identity for themselves, but copied what others were doing.

On the flip side, Sears and Wal-Mart are emerging as winners.  Sears was on a downward slide until it repositioned itself with its “softer side” advertising campaign, which it supported by upgraded apparel lines and better product selections.  Wal-Mart, on the other hand, has simply continued proving itself to have the lowest everyday prices.  It found out what its customers wanted, then made sure it provided it.

In the salon industry, this concept has caused a sort of identity crisis for mid-range salons: They can’t afford to offer clients the lowest prices in the market-place, but they don’t provide any other compelling reasons for clients to pay more.  They don’t usually have the ambiance of a high-end salon, nor the services to maintain clients.

How can you create an identity that draws clients through your doors and keeps them coming back?  Simple, says Lary Gaynor: “Find out what your customers want.  Survey them with 10 questions.  Ask them if time is of importance.  Which service do they enjoy getting?  And while you may not be able to redecorate at your customers’ whim, find out what kind of music they want to hear or what programs they want on the TV.  Examine every aspect of your business and figure out how you can make it more appealing to your clients.

At the same time, you cannot afford to ignore what your competition is doing, warns Gaynor.  “Understand your competitors.  Go to the salons yourself to find out why people go there; experience them firsthand.   Then make sure your salon is competition-resistant and that your customers don’t want to leave.”

That’s simple marketing.  There’s a great saying about marketing from Jean Bailey of Helene Curtis, a leader in the salon industry.  “Marketing is not a war with your competitors; it’s a love affair with your customers.”  Understand both your competitors and your customers, then give your customers what they want.

 

Keywords:   discount salons     keeping your business competitive     licensing     promoting your services     Vietnamese salon industry  

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