7 Ways for Hair Salons to Survive & Thrive in 2023
Whispers of a mild to moderate recession have leaked into the economy, and the buzz has not gone unnoticed in the salon industry. It leaves hair stylists, booth renters, colorists, salon owners and salon suite operators wondering, how will my business be affected?
While many in the beauty industry are on the upswing of economic growth since the pandemic, it feels almost eerily too soon to go through another communal crisis. We just experienced the nuances of industries across the board getting hit with monetary shortages, distribution disruptions, inflated product costs, loss of loved ones, temporary shutdowns, an unstable investment market, and unpredictable metrics for predicting growth vs. slow periods. How can we balance our books and create future projections with so much uncertainty?
Thankfully, the breaches of financial stability aren’t being touched by an unfeeling virus reeking havoc on life and stability as we know it. What experts are suggesting is, this round is more self induced by the federal reserve. This in a way, can actually be good news, or at least manageable news for salon owners in comparison with other industries and here’s why.
Essential Even When The Higher Ups Induce High Percentage Rates
For the foreseeable future, the federal reserve will continue to stifle inflation by raising rates in a few sectors. The idea is to raise the rates, discourage spending and cool down the bloat of inflation by 2024. But with the trends running as they are, this cool down is very well landing us in a bit of a recession.
What happens is the typical results of tampering with supply and demand where due to spending tightening up on a broad scale, many industries take the hit and the results impact the job market. People may not be able to get jobs or company owners may reduce labor to save.
But this is why owning a salon during this type of downward trend can be good. Hair is both a luxury and a necessity. So while high end luxury spending gets tightened up, the lipstick effect means spending on hair does not. While loans aren’t granted for mortgages, large machinery, overnight loans between banks, and projects requiring financing without huge interest rates, salons operate by the skillset of a laborer who is often running off a commission, not an hourly wage. Large loans aren’t needed when the power of the service lies in the hands of the artist. Stylists are then positioned uniquely to thrive during a recession.
Spending on vital services like haircuts may not be affected as it's a necessity, but clients might want more time between services. Color might experience the same shift. While people will continue to do their hair, they may space it out. Offering services well suited for this shift can position a salon to stay strong during a recession. Services like Balayage, Color Melting, and Precision Haircuts. Are you ready?
Let’s get that way by looking at a few ways salons can maintain or even scale just before and even during a recession.
7 Ways Salons Can Scale Just Before and During a Recession
- If You’re Expanding, do it Now
Expansion requires loans, resources, accumulating artists with vital skill sets, and time to grow in the area of choice. With a recession possibly taking shape at the end of 2023, finalizing the details of your second expansion (or whatever number of salons you’re opening) needs to happen ASAP. Salon owners don’t want to find things pushed back, only to open and not have the volume of customers they normally would due to the recession.
- Offer Hybrid Services Across Beauty Industries
A one-stop-shop becomes extremely appealing during a recession. Why is that? Psychologically, making multiple appointments and driving to multiple locations requires more spending and can be seen as a “luxury” activity. During a period where necessity is in the spotlight, people will feel better about driving less and scheduling less appointments in a month by consolidating appointments together in a single day. Can they get their nails and haircut all at once? Saves time, energy, and gas money while fitting in with penny-pinching thinking.
- If you Haven’t Started it Already, Opt for a Monetized Blog that’s SEO Driven and/or Monetization from a Google Ads Account
If you’re writing to your audience, get paid for it. There are a number of ways to get paid from a beauty blog. Salon owners/ individual operators can also get paid with Google Ads. Linking an Ad for your salon with google searches is a great way to gain exposure, get more phone calls, and increase customer traffic. Starting this kind of exposure before the impact of a recession will be well worth it.
- Take a business class/coaching session with Kristen Lumiere or Jaime Sea
Nothing stifles a recession like good education. The correlation doesn’t seem obvious, but the link lies in forward thinking to plough through times of economic downturn while gaining all the right information. Acquiring knowledge about how to scale a successful salon business from people who have already done it and continue to grow, only adds value to your salon endeavors. Take one of Kristen Lumier’s business classes or Jaime Sea’s coaching sessions.
- Operate with Salon Management Software
Keeping sharp tabs on business insights is one of the best ways to navigate the push and pull of supply and demand during a recession. You can see at a glance what products and services are sought after most, what your profit margins are, inventory, and maintain credit cards on file. Having a card on file is extremely important in relation to your cancellation policy. If clients are a no show or don’t cancel within 24 hours of their appointments, they have essentially taken money out of your hands. But operating with a known cancellation policy and charging accordingly, your time remains financially valuable.
- Get paid for Youtube Shorts
This February, Youtube is monetizing its views of short videos (60 seconds). In the past, Tiktok went through this as well and short videos went viral left and right. The same thing is about to happen with youtube shorts. You get paid for views once you’re part of their Partner Program, which is as easy as a few clicks of a button if you already have a youtube account for your business. This is a great way to gain exposure and get paid while you’re at it.
- Capitalize on Beauty Trends
Beauty trends thrive hard during a recession. People want things that make them feel good more than ever. Beauty trends do just that and you can believe they’ll be searching their phones extra for it. But if something like the Wolf Cut is in the spotlight, do your hair artists know how to do it? Capitalizing on trends can be exactly what it takes to stay afloat amidst a recession, but offering education to your stylists so they can capitalize on hair trends will be vital.
Are Hair Salons Recession-Proof in 2023? | zolmi.com
What Happens When The Fed Raises Rates? – Forbes Advisor
Will there be a recession in 2023? 3 economic predictions for the new year - Vox