Category: Hair Salon Business

Why is retail important in a salon?

There seems always to be resistance when it comes to offering salon retail to customers. I hear it all the time the stylist says I'm not a salesperson I'm an artist. I get it and know we as hairdressers focus more on offering our clients services than take-home products.

As professional salon owners, we have much responsibility not only for our clients but for our staff as well. People rely on us to make sure rent and bills are taking care of, and supplies are ordered and delivered.

It takes multiple streams of income to run a business today, and salon product sales can cover many of your expendables. Not to mention as hairstylists offering haircare products as take-home maintenance for your clients build a reputation as a professional.

How Can Salon Retail Increase Your Sales Revenue?

Let's face it there are two scenarios as to why you opened a hair salon.

  1. Freedom: Being a salon owner can be hard work but very rewarding at the same time. You are the boss and set up systems and structures the way you want them. You get to design the interior, decide what products you will carry, and hire a team you handpick.  You have the freedom to do whatever you envision a successful salon looks like for you.
  2. Money: You may not admit it, but you wanted to make money. Maybe you thought owning a salon would be financially rewarding and build a future for you and your family. Create a place where talented hairdressers would want to come and make money as well. Who doesn't love money, right?
Okay, so both are valid reasons why to open a hair salon and both achievable. Whatever your motivation as it will take sales revenue to achieve keeping the doors open to your hair salon.

That revenue will come from three areas of income:

  1. Hair Salon Services: Ahh, the fun stuff, right? Precisely placed highlights, custom formulated hair coloring, and crafted precision haircuts on naming a few. Everything that defines us as hair artists and creatives.
  2. Hair Salon Retail: Your should be shooting for at least 20% of revenue coming from product sales. It roughly takes 40% of total sales and revenue to cover your expendables. Retailing professionals products can pay your rent every month.
  3. Gift Card Sales: Hopefully, you are offering gift cards to your clients. Gift cards can Attract new customers, improve sales, increase loyalty, and help retain clients. Someone who purchases a gift card is 67% more likely to spend more in your salon, which can increase your bottom line.

Here is the deal you won't get rich on selling retail to your customers. The fact is, as I said before, overhead expenses for a salon/spa typically run +/- 40 percent of total revenue according to strategies.com. If you are marking up the products 50% and pay your staff a 10% commission, you are working on a loss. 

By offering your clients professional shampoo & conditioners, you are adding value to their visit. It shows your customers you care about how they will recreate the beautiful look you created for them at home. 

Most of all, you have set up another revenue stream to be able to keep the doors open and living out your dream of freedom and stability for you and your family.

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Is A Hair Salon A Retail Business?

The short answer is yes! The beauty industry is a multi-billion dollar industry, and it all started with the salon industry. 

In 2019 the competition is fierce with retailers like Ulta Beauty, Sephora, and now Amazon. What sets you apart from these giants is you and your skills. You build a relationship with the client and add value and trust to them.

The relationship you offer and product recommendation you give them is what keeps them coming back. The client wants it and expects it. Most stylists feel that if they recommend products, they are pressuring the client to buy and spend more money with them and see it as an inconvenience. 

I promise your clients want and look forward to you talking about new products and how they will benefit from them.

So How Do I Make My Stylist Sell More Retail?

The best way to motivate a hairstylist is to educate them. The biggest motivator for your employees or renters is money and knowledge.

 MONEY

It's no surprise your team is motivated by earning a better income. But most are not interested in taking the steps it takes to do so. Harsh huh? When it comes to retail 10% of $1000  doesn't motivate me either. I can focus on adding an Olaplex treatment or highlights to my service ticket and get a much higher return.

Here is a game-changer let's say you offer Olaplex treatments why not create a promotion where when you receive the treatment you get the shampoo and conditioner to take home? How would this work? let's say the service is $30 and the product costs $15 salon cost. Offer a deal where for $50 you get a service upgrade and the client gets to leave with the products.

The stylist gets the commission on the services and the salon receives the retail sales. Everyone benefits and the stylist are more motivated to offer the service to their clients.

If you run a booth rental salon offer your renter a chair discount if they retail products to their customers. Set a goal and when they hit it reward them. Create excitement about retail and the benefits it offers to both the staff and the clients.

Reality is most stylist won't focus on retailing and you can tell them they have to or they won't get the commission and honestly they are ok with it.

EDUCATION

The second motivator for hairdressers is education and knowledge. Knowledge destroys fear! As a salon owner, you want the best talent working in your salon and that takes developing talent.

In the early '80s, '90s and 2000's hair salons offered training either by inlisting distributors and by focusing one evening a week on education. In today's world, we rely on getting knowledge online. It just isn't the same as organizing a model and everyone working on technique together as a team. Education brings people together and creates a buzz.

You can start the night off by featuring a product and going over the features and benefits of that product. Then go into the technical training for the evening.

Doing in house training takes an investment of time on your behalf as an owner. The payoff can be huge for your business and staff. Look around at the competition in your area and see what they are offering for their stylist especially the salon who have full staff.

I hear it all the time that salon owners can't find a stylist to work for them. Stop and ask yourself what you are offering to intise them to join your team.

Teach your staff the importance or salon retail and how it can help them in retaining their clients. Adding extra income to their paychecks. Teach them, lead them, and value them. 

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What Are The Best Hair Salon Products To Offer My Clients?

What products to offer is a topic that could be broad, and it comes down to personal preference. Some product companies like Aveda provide more than other companies but can be a lot of upfront investment to a salon owner. Many of today's owners are looking for retail companies who don't sell to the big box retailers like Ulta.

I like the idea of a salon only direct line, but they are becoming harder to find to work with. The loyalty game has changed in our industry. We, as hairdressers, built the companies and have left us feeling somewhat used and neglected.

So if you believe in a line of products and they offer you and your team plenty of education, I say go with what is best for you and your business. Don't be afraid to reach out to your distributor and ask for what you need from them. A lot of the local distributors and competing with Amazon now, and I promise they want you to continue to buy from them instead of ordering online from their competitor.

You can offer mix and match or multiple lines. Just make sure that you are budgeting correctly when doing your ordering monthly. Never let the sales rep do your ordering for you. I know you are busy doing all you do, but you should control your inventory.

Customer Service Is Related To Sales

When you give an excellent customer service experience to your client and add value to them, it creates loyalty, and they will return to spend more money with you. If that isn't sales, I'm not sure what is. You see, sales isn't a dirty word, and the faster you put aside your ideas that your client isn't interested in being told what they need, the more you will grow as a professional.
If you thought to become a hairstylist or salon owner wasn't about actually making money, you must have read the pamphlet wrong.
People come to you to give you money for a service and your educated knowledge of what is best for them and their hair. It all starts with the consultation and your initial assessment of their hair. Before you move forward with any service, recommend a prescribed product recommendation for home use.
Products should be mentioned a couple of times throughout the salon visit. It doesn't have to be sleazy or uncomfortable. Just tell the client what you are using on them as you apply the product. Please give them the benefits it will provide for them and their hair.
Now go and be awesome and start offering more salon retail products and make more money. Set goals monthly and share them with your team when you hit them to celebrate and reward the people who help you achieve them.

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