Archive for the Improving Profits Category
Posted on September 28, 2011 with No Comments
Private labeling your own salon products can help increase your bottom line and you customer base at the 
same time, which can bring in extra revenue. You make way more money by private labeling your own products than you ever would selling brand name products, plus you are getting your own line. To salon and spa owners private labeling is an easy way to make more money, and build a strong customer relationship. One good thing about private label salon products are you control everything about them, down to the scent.
Employees will more eagerly sell there own products than other name brands because they know it will bring in more revenue, which means better jobs for them. We all know that new salons and spa’s are opening up daily, the beauty business is larger than it has ever been. Each spa has their own little niche they are trying to fit into, to sell their specialized products. Now with the power of the Internet salon and spa owners can even sell there products online, and expand there customer base worldwide.
Once you get your own private label line you will be surprised on how fast you will have your customers hooked on your products. Since you are the only supplier of your brand then you will see more repeat customers as well. These days you can get products made for you in for about everything you can imagine.
The products price depends on the quality of the ingredient that go into it. The cheaper the ingredients the cheaper you can buy the products for. The more expensive the ingredient the higher the product will be but it will also work better as well. So one thing to decide is if you want to buy and sell cheap, or buy high and sell higher.
Because you are in control of these products you can customize everything from the logo and name of the product to the color and scent. Every year you will see more and more people leaning toward more natural products so that is always a good way to go. People generally feel better about using natural products, especially if they work.
There are so many people looking for the next product to rock there worlds getting into private labeling salon products is easier than you think. You can make more money on each products and pick and choose exactly which products you want to carry. Designer brands are ok but really expensive and too much hassle so why not make your own brand up, what do you have to lose?
Posted on January 19, 2010 with No Comments
Though business had its usual “kicker” around the holidays, our contacts in the idustry continue to report business is down approximately 30-50% over levels in 2007. This of course is function of location, clientele, and perceived quality by the surrounding community, but it is still a very low number.
Making Salon Business Better
All of us have been fighting to increase business, traffic flow, product sales and client retention. Through-out this blog, I have written a number of posts on ideas that are worth considering. Take a look around and you might find something that will work well for you – or you might find several ideas that, when used in conjunction, can bring sales and revenue to pre-recession levels.
One idea that I noticed recently (that hits on the perception of your local marketplace) is the idea of upfitting your shop. One of the local salons – large volume and mid-market – undertook a “facelift”.
So, what do I mean by a “facelift”?
Well, first of all, I don’t mean a re-build. What I observed was the owners re-painting the out side and inside. Adding some startegic plants, putting-up new artwork, replacing aged promotional banners and signs, and reorganizing product displays…and replacing their signage.
This took a couple of weekends to complete and I doubt the cost was too much. I looked like DIY project. The building does not look materially different, but fresh, clean and vibrant. I’m guessing the new sign cost ~$1,000-$3,000, but the remainder of the work was probably done on a budget of less than $1,000 – a true HGTV makeover!
Following the changes and upgrades, the owners placed an elegant, yet inexpensive banner outside (approved by the city of course) announcing “A New Year, A new Look!”, with an invitation to a ”Grand Re-Opening” . They invited customers, guests, and some local well-known celebrities out for a drop-in. They have free drinks, snacks, and a photographer for pictures in the local paper and their website.
Overall, it was a great, innovative idea and proved to be a “design on a dime” success!
Good Luck…and please pass on your ideas and comments. Thanks
Posted on November 10, 2009 with No Comments
Saturday night my wife and I had the opportunity to attend a Grand Opening of a salon’s new location. It is owned by a good friend we have known for years – and his partner and her husband.
It was a big bash with lot’s of folks, wine flowing and great snacks. The new location was an old house that had been
Private Label Hair Products
converted sitting in the heart of the old part of the city – just where you would think a progressive, fun and upscale salon should be. They did a great job on refurbishing the old house – plenty of walking room, interesting decor, well-laid out sections for washing, drying, styling and waiting.
A Case for Private Label Hair Products
We wanted to visit, but not steal the hosts from their other guests – so, we were only able to spend a few minutes together. With that said, we exchanged pleasantries and congratulations. What caught my attention was the next thing that came out of his/their mouths – “You know, we really need to discuss getting a private label line of products in here. It is becoming very difficult to work with the distributors, the manufacturers and there is little margin in the products we do sell.”
They went on…”…look over here – we have two display cases filled front and back with $1,000′s of dollars of products and they just sit there. We sell a few, but customers become uneasy when we ‘promote’ the products, plus sooner or later we are notified the products are discontinued?!”
So, why are they teeling me this? Because I am the managing partner for a small, niche hair products manufacturing and distribution company. We do wholesale of our brands – Nourish, Healthy Hair Plus, ProFolla, ProFolla Silk, Strimedix, and RegeneVal. And, we do private label for some salons and distributors who want to market their own brands or establish their own identities. We do a few proprietary formulas, but 95% of our customers choose from over 200 hair and skin products we have available.
I don’t mean or intend to promote our products or our services (but you need to sometimes), but I wanted to write this post because it is the 5th or 6th time I have have had this comment made directly to me and the “ump-teenth” time I have seen this subject come up in a blog, article or as a topic in a magazine article.
Why Does a Private Label Hair Products Line Make Sense?
Here’s the $50,000 question that I get everytime along with a couple of add-on questions like…how do you do it?….how much does it cost?…what products should I choose?…should I do wholesale or private label?
Well, before we talk about the process, let’s discuss what you can gain:
- Build a product mix that works best for you and your customers and clients
- Choose the products you want…not just those that are available
- Improve loyalty and exclusivity with your own brand
- Increase traffic
- Increase ancillary product sales
- Improve salon margin
These all sound very good. How do I get started??
Without going into a small book on the process, here’s a summary:
- Determine start-up budget (smallest – $100 for a few wholesale products; plan for $500-$2,000; big plans – $10,000)
- Choose the products you want to carry
- Shampoos, conditioners, styling aids
- Solutions – Dry, oily, colored, permed, dense, coarse, breaking, scalp problems
- Supplemental skin products
- Choose the plan of introduction
- Start with a few, or a whole line…or a sub-line (volume and dry, for example)
- Determine any promotional or display steps, if any
- Private Label or Wholesale
- Labels or screens (silk screens)
- Labels cost – design cost + ~$2,000 for labels themselves
- Screens cost – design cost + ~$250 for set-up + $.50 per bottle
- Minimums – generally a case (48) down to 6 (half dozen)
- If you want to do a special formula, count on minumums in the hundreds or thousands
- Shipping costs must be incurred
- Shipping, delivery time usually 2-3 weeks
- Create you own hair products brand!
Bottom line – start to finish, you can have some wholesale products on the shelves in a few days. To design a screen/label, get screen/label made, product produced and shipped consider 5-8 weeks. This isn’t actually too bad. We tell most of our private label customer to plan on 2 months or less start to finish.
If you’re considering a private label hair products line, visit www.alternativebeauty.com or call our Customer Support Staff at 888-909-1658. The site, though not winning any design awards, it has most of the hair and skin products we make (about 90%). But, we always have new products in the works and have access to a number of formulas for special projects or needs.
Posted on October 27, 2009 with No Comments
Whether you’re a salon owner or a concerned parent, you should give So Cozy Boo! Shampoo (lice shampoo for children) a careful consideration. Not just because it has been shown successful as a natural-based lice repellant, but because it’s FUN!
Boo! Shampoo
Good for Kids
Yepper, that’s what I said…FUN! Between its creative name, catchy slogan, purple label and “spooky” font-style, it and its companion, Boo! Conditioner, are fun for everyone – kids, parents, and salon owners (because you’ll probably be selling them and getting rid of nasty critters at the same time!)
Boo! Lice shampoo is paraben-free and is not formulated with either of the Laure(th,l) sulfates, so it is gentle on the scalp and for younger kids hair. Tea Tree oil keeps away the bugs, and it smells great! Best of all, kids get excited about it – that’s almost enough to make parents happy.
Good for Parents
Both Boo! products are made by So Cozy and who also have a chain of kids/children hair salons. Though I can only speculate, I’m sure the saw a problem and addressed it. Cool label, image, and colors…just what the doctor ordered when trying to keep away bugs – when can be a not-so pleasant discussion.
In addition to the “cool” look and verbiage (We make hair care Fun!), they use a very creative twist to approach the issue of lice – which most folks envision crawling around on their kids pillows at home likening it to infection, the flu or a plague – they refer to it as a “camp and school formula”.
This little marketing trick, whether intentional or not, moves you away from the “not in my house” panic to “oh…ha, ha, ha…he must have gotten them at school or while he was camping…no big deal, we’ll just use this shampoo”. Its a great technique used by pest exterminators and plumbers. Take an icky subject and make it fun…somehow!
So, from a parent perspective there are several reasons why you might want this in the shower or next to the bath:
- It repels lice, ticks, and various bugs
- Its got a fun logo, slogan and mission which kids like
- Colors are fun
- It might entice your children to shower or bathe more often
- Its a natural-based, safe shampoo
If you’re a salon owner, there’s several benefits for you as well:
- You add a unique product to your line
- You liven-up what could be an over-serious discussion about bugs in kid’s hair
- It diversifies products into “natural” or “organic-based” category with no sulfates or parabens
- You can help build customer loyalty
- Increase salon revenues
If you’re looking for a funproduct to get for your kids or a new line to add to your salon, take a look at Boo! Lice Shampoo and Boo! Spray-On Lice Conditioner – both are excellent repellants, smell good, and are safe for even the most sensitive scalps.
Posted on September 28, 2009 with No Comments
In our continuing quest to increase sales and traffic in salons and barber shops, consider selling major brand salon products at a discount – it has worked for Wal-Mart and other major retailers, it might just work for you!
Many salons and barber shops I have visited generally carry one to three major brands they keep on the shelf. If promoted by the stylists or owner, you might get a few sales. Unfortunately, this is often NOT the case and product sits on the shelf moving very slowly. If this sounds like it might be the situation for you, then consider an alternative – deeply discounting well-known shampoos and conditioners to attract more customers and increase sales.
Many small and even multi-unit shops believe products should be marked-up to give them the highest margin. For high-demand products or if your shop has high traffic, this very well may be the strategy you might follow. However, as with many types of products, there is an “elasticity” to the price and volume associated with most products.
“Elasticity”, or more commonly referred to as “price elasticity”, refers to the sensitivity the product’s price has on its sales volume. For the highest demand products, the price can be raised quite high before demand drops. For most products, however, discounting the price leads to increased sales – to the point where discounting no longer shows an acceptable profit. The trick is finding the perfect balance – and that balance varies depending on the product’s demand and exclusivity (can they find it somewhere else?)
Many salons sell brand products at a 100% mark-up or a 50% gross margin. This is typical is the similar mark-up the distributor might get from the manufacturer. For instance, a distributor may get Kenra shampoo from the manufacturer for $4.00. They in turn sell to the salon for $8.00. The salon in turn sells to their customers for $16.00. Pretty stardard fare.
But, what good does a good, high or reasonable mark-up get you if you don’t sell anything?
Therein lies the the justification for selling discount salon products. If you discount a $16.00 shampoo 25% (selling price of $12.00), you still get a reasonable gross margin (GM), but you might triple your sales – puttting you ahead on cash and profit. Also, if a customer likes the product they bought AND the price is good, they will likely return for more purchases – giving you an annuity-like revenue you didn’t have before.
While this sounds good on the surface, you must promote the products. Signage, ads, recommendations by stylists, etc can “get the word out” improving traffic. Next time we will talk mores specifically about how to promote your discounted products.
Tags: barber shop management, discount salon products, hair salons, improving sales, increase profits, increase revenue, increase traffic, more sales, recession, salon management, salon products
Category: Community, Improving Profits, Traffic & Revenue
Posted on September 21, 2009 with No Comments
A good friend of mine owns one of the largest hair salons in north Georgia. Owned and run by he and his wife, they have experienced a measurable drop in volume and sales in the past 18 months.
Theirs is a full service salon offering color, perms, straightening, and serve both women and men. In the past, they also offered facials along with foot care and fingernail work. The first thing they noticed was business dropping in these ancillary services – primarily because they were not considered necessities per customer feedback.
Regardless, during “good” economic times, these services sold well and were considered by many a very relaxing way to complete a salon experience – not necessarily competing with a spa or day spa, but a nice supplement to services and a very nice add-on for additional revenue.
Something you might consider to increase salon revenue, is to offer a promotion of a free facial periodically. While this may not be a tactic you want to offer daily, picking a day or two a month might be a big draw to bring in some very tired customers looking for a renewal.
The cost can be minimal relative to a big boost in sales. Setting up a station toward the back of the store may be as easy as putting up a few screens and there should be plenty of massage experts who would be willing to work a dy or two a month for some additional exposure.
If you have an outdoor display, post the promotion or foot the bill for a $50-$100 banner that you can display. For those salons who have tried this, promotions have ranged from “free” to “free with a perm or styling”. Again this may not be an answer to an overall increase in permanent traffic, it’s a service that will probably bring in new customers and boost loyalty of your current customer base.
Tags: Add new tag, hair salons, increase profits, increase revenue, increase traffic, recession, salon management, salon revenue
Category: Community, Improving Profits, salon management, Traffic & Revenue
Posted on September 11, 2009 with No Comments
For small, large, and boutique salons, it is rare to not see a sign that says “Walk-ins Welcome”. But is this a good tactic for increasing and traffic and revenue? Let’s take a couple of minutes to discuss.
“Walk ins Welcome“provides an opportunity for the salon owner or manager to communicate to the world that you don’t need an appointment. While this certainly doesn’t ring an “ha-ha” moment and seems pretty obvious, the strategy is to avoid the notion by many that appointments are required to get your hair styled or cut at a busy or upper-end salon.
While it is true getting into one of the better salons can be difficult, there are generally stations and stylists available whereby you can fit-in folks who walk-in. The benefit is you are able to avoid what is a deterent to many potential customers for coming into your shop – namely, the necessity and hassle required to stop-by or call to schedule an appointment.
Recently, as business continues to drop during this recession, I have increasingly seen higher-end salons letting folks know that appointments are not required, and in fact, new clients are welcome at the drop of a hat.
Can this hurt your reputation, though? We asked several owners what their opinions were and the responses are not all that surprising.
We discussed this with what I would consider an “average” large beauty shop owner. On Fridays and weekends, his station salon is generally full – of stylists. These are mostly independents who have “rented” stations. Give they only have 3-5 appointments per day, getting a walk-in 2 or 3 times a day can be a significant boost in traffic. Additionally, this salon has a large “beauty shop” inventory of supplies. So, getting a few new customers also brings the benefit of boosting sals of shampoos, brushes, dryers, falt irons, et al.
The second interview we had was with a partner/owner in a very upscale salon in the heart of a high-end outdoor shopping area. Her perspective was her clientele came from word of mouth recommendations by satisfied clients and that her and her staff’s days were filled. In fact, promoting “walk-ins welcome” would do very little good since their salon was located on a side street with little or no high-volume foot ot car traffic.
So, the debate seems to fall on the side of promoting “no appointment needed” if…
- You are in a highly trafficked area – either pedestrians or vehicles
- You have excess capacity and time
- Your price points are within the range of most reasonable consumers
- You can benefit from ancillary beauty supply sales – combs, brushes, hairsprays, shampoos, blow dryers, etc.
- You and your staff are well-trained in the art of customer service
