I finally got a hair cut this past weekend. It came out to be around $55 with tip, is very reasonable. My stylist, “Holly”, gave me some nice long layers and a saucy flip (though unfortunately only achievable through a professional blow-dry).
She was really chatty and friendly, and somehow the conversation turned to finances and the recession. I asked her about the business model of hair salons – apparently, some stylists work on commissions and receive clients through the salon, others are solely renters who pay the salon a weekly rent and recruit their own clients.
Holly said that she used to work as an assistant stylist in a very upscale salon in a very upscale part of town – where a week’s rent for a salon space is $800! Of course, the cut and treatments at that salon can range from $300 and upwards. On the good days, Holly said, her boss (the main stylist) would net $1,200. A DAY.
Of course, when the recession hit, bookings fell. They noticed that the clients are spacing out their appointments more and more. Instead of coming back for a trim or a new ‘do every 2 months, clients might be waiting until the 4th or 5th month mark. I also imagine that many people would bypass the more expensive treatments like hair color and perms and settle for a simple cut and blow-dry. All of this cut into their profits.
That’s why Holly decided to move to her current salon, which operates on a lower price point (think $50 per cut instead of $400+) and is located in a less swanky area. Her per-cut take is much lower, but the increased sales volume makes up for it.
Another real-life example of market pricing. Love it!