Pricing Strategies for Salons: How to Set Rates That Reward You & Your Team

Is your pricing correct?

When I opened my first salon, like most of us, I needed to set my pricing strategy. I looked at the salons near me and set my pricing based on what I found. If I felt my salon was a little nicer than one, I charged a bit more, and if I thought another was higher-end, I charged a little less – and that was pretty much it. As far as I can remember, I don't think I considered basic operating costs like rent, overheads, or salaries, let alone any profit for me. I may as well have licked the end of my finger and guessed, for all the strategic business acumen I demonstrated.

Some salon owners are still doing this now. So, what are the pitfalls to avoid?

Inconsistency

If you were to run a list of your 10 most commonly booked services or treatments and then calculate your average hourly return, would the hourly revenue be similar? For example, let's look at a hypothetical beauty salon. They charge £30 for a manicure and £60 for an aromatherapy massage. On the surface, this might look fine, but what if both appointments were scheduled for an hour? Are you giving your business (and your team) a chance of succeeding by generating half the hourly rate for one treatment over another?

Failing to Account for All Costs

Many salon owners miscalculate their costs by overlooking certain expenses, such as product costs, equipment maintenance, marketing expenses, and staff training. This can lead to pricing that doesn't cover all the necessary overheads, potentially resulting in financial strain and unsustainable operations.

Calculating for Profit

Every price will need to be calculated with profit in mind. This is an amount in addition to salary costs that contributes to the success of your company.

Price Tariffs

Use price tariffs to ensure that you can reward more experienced and higher-performing team members, as well as provide a platform for less experienced team members to start building a clientele, getting real-world experience, and also cover their own costs by contributing to your salon sales.

Setting the right pricing strategy is crucial for the success of your salon business. It's not just about charging what your competitors charge or guessing based on gut instinct. A well-thought-out pricing strategy should consider your operating costs, desired profit margins, service expertise levels, and market positioning. By taking a strategic approach to pricing, you can attract and retain clients while ensuring the long-term viability and growth of your salon.

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