3 Reasons Why The Current Model Is Failing The Salon And The Stylist, And What to Do Instead

The salon industry has stuck with the traditional pricing model for way too long and honestly, it’s not working anymore. Salon owners and stylists are feeling the strain, from profit struggles to pricing confusion. 

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Here are three big reasons the old-school salon model just isn’t cutting it anymore—and how you can switch to something that actually works.

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1. Service Fee Based Pricing Creates a Constant Battle

Many salons bundle product costs into the commissionable service total. Leading to an ongoing struggle between stylists who want higher commissions and salon owners who can’t afford to pay more.

Why? Because product costs are fixed, they have to be paid for and restocked. If these costs are included in commissionable earnings, the salon is essentially paying 1.5x for each tube of color. Over time, this chips away at profits, making it impossible to offer fair wage increases.

Instead of this flawed approach, salons should separate product costs from service prices. By charging for color separately, salons can protect their bottom line AND have the opportunity to increase their stylists wages. Plus you can guarantee that the product used is paid for. 

2. Unclear Pricing Fails Everyone—Stylist, Client, and Salon

The success of the commission model heavily depends on the stylists:

Need more color? Add a couple of extra bowls and hope the cost somehow gets covered. 🤷🏻‍♀️

Not charging for those extra bowls? The salon loses money.

Overcharging to make up for losses? Clients may feel blindsided by inflated service totals.

A common scenario: A client books a $200 color service, but with two additional bowls at $20 each, their final bill jumps to $240. The stylist feels awkward adding those costs, the client feels misled, and in many cases, the salon ends up absorbing the extra expense.

By implementing a Parts + Labour model, salons can ensure every drop of color is accounted for, without relying on the stylist to decide how the product gets charged.

Plus, your client has transparency, knowing they’re paying not only you, but they're only charged for what is being used. 

3. Waste Isn’t the Biggest Profit Drain—Your Pricing Model Is

If you’ve ever felt frustration watching stylists rinse out bowls of wasted color, you’re not alone. While reducing waste is important, it’s often not the real reason your profits are disappearing.

The bigger issue? An outdated pricing model that absorbs these costs. Even if you cut waste by 50%, you’re still losing money if product costs aren’t properly factored into pricing.

Stylists aren’t intentionally trying to create waste, the best thing to do is understand what's causing the over mixing. Are they rushed at the backbar and free pouring? Find ways to slow down that process and make it mindful.

Rather than focusing solely on waste reduction, salon owners should look at real-time product tracking and transparent pricing models to protect their bottom line.

0% Waste Example: Even if you cut your color waste to zero, you could still be losing money. For example, if you charge a $14 service fee but your actual color cost is $28.18, you’re already $14.18 in the red. Waste isn’t the only issue—undercharging is.

There’s a Better Way…

SalonScale is the perfect solution for salons looking to move beyond the struggles of commission-based pricing. 

✅ Product cost is tracked in real time, so it can be accurately and transparently charged for. Plus we save your formulas too. 

✅ Remix features to help eliminate over mixing and waste.

✅ Simplified stylist management for salons of all sizes.

Salons using SalonScale on average see an increase of $25,000 - $50,000 of pure profit annually!

Book A Demo Now!