Is your pricing strategy making you money

Chris Amos and Richard Wallace of Winning Ways Education had a stark warning about the importance of an effective pricing strategy for the audience at their Salon London presentation as part of the NHF Business Workshops. “In the next three to five years prices will be so important. You will have to increase them by about 30% to deal with the living wage,” they revealed. Profits have already been hit by changes to holiday pay, pensions and the increase in the minimum wage and they explained that it is essential to find ways to make more profit from the clients you already have. These are their key strategies for increasing your profit.

• Get to know your average bill because you can only improve when you know where you are
• Think about children’s cuts – how much do you charge and how much do they cost to do? You don’t have an obligation to do them cheaply.
• Do you need to differentiate between a cut and finish and a redesign? By removing redesign from the service menu and increasing the price of a cut and finish you’ll see an overall increase in revenue.
• Add value when you increase your prices and that means thinking about the client journey.
• Introduce staggered pricing so people understand they are paying more for the stylist’s experience.
• Be prepared to lose some clients, but know that you will also attract other people who wouldn’t have come to you before.