Salon owners, like business owners across industries of every kind, are struggling to stay ahead of rising business costs, combating the cost of living, and make a profit.

Many salon owners are trying to make decisions and find solutions to these challenges by trial and error, many more are afraid to raise prices in fear of losing customers.

In an effort to keep top hairdressers, many salon owners resort to any number of the following: recruiting top stylists from their competitors; paying commissions that are too high; or renting out stations just to survive. Click here.

Raising prices of services, are options you may want to consider. Here are a few tips to keep in mind: This topic will be one of the topics I cover at my 2 day business only seminar August 24-25 in Las Vegas. Click here

Positive Word of Mouth Referrals and Salon Demand – Referrals will be your score card in helping you decide when and how to raise prices. Monitor your customer return rate for each member of your team. If your referral rate is high, then you should consider raising your prices.

It is important to note before you raise prices, you must first create a demand, and monitor profits, then consider raising prices with individual salon team members, or raising prices for the entire salon.

Raise Salon Prices not Commissions – Raising prices is a win-win situation for salon owners and rewards your hairdressers for their hard work and dedication.

Deciding When to Raise Prices – Once you’ve created a demand for services and have a high rate of customer returns, referral,profits, adjust your pricing as needed.

However, if your salon is not busy, you may have to keep your existing prices stable until you are able to create a demand for your services. The best time to raise prices is 2-4 weeks before your busy season. January and February are notoriously slow months, as is “tax time” in the US!

Rule of Thumb for Price Raises – Generally, small increments is best. Chemical services can be raised by $5.00, or hair cut prices by $2-3.00 depending on your salon’s reputation.
If your salon is busy,you may want to raise your prices a little more.

Getting the Message Out – Before you announce price increases to your clients, have a staff meeting to discuss the changes.  Be sure your staff knows how to present the increase in the best light.  Once you’ve met with the staff, create a simple sign that can be displayed near your sign-in or reception desk.

Here is a simple sign that was effective for me.

Effective June 3, their will be a slight adjustment of our fees, list the amount on your new price list.
Thank you for your understanding, we value your business.

Marketing Campaign — plan ahead with an advertising and marketing campaign through you tube or on your you tube channel listing the benefits you offer and invite for a free image consultation to bring in more new customers to replace a few customers you may lose. If you do lose a few customers this is not the client you want in your salon.

If your salon and staff are  outstanding, people will understand.you and your team have a right to keep pace with the high cost of living.

Personally I seldom lost customers, in fact many would reply,is that all?

Here is a sample letter, effective June 3,there will be a slight increase of fees for our services.

A simple “Thank you for your understanding and continued patronage” statement goes a long way.