Salon Pricing: Expectations vs Reality

Opening a salon (or a suite) is SO exciting! Your dreams are finally coming true!

Then you get to the tricky part, setting your prices. It’s the thing NO ONE likes to talk about. But to be honest not giving it the attention it deserves is sabotaging your business.

The Expectation on Salon Pricing:

You open your brand new salon. You set your prices based on salons in your area, prestige, and demand. Celebrate becoming a business owner and becoming your own boss - as you should! Adjust your pricing as needed. 

The Reality:

Pricing is tricky, but not as much as you may think. Competitive pricing is the most popular pricing method because well, it allows you to be strategically in line with other salons in your area. We like to call it healthy competition. 

But, if setting your prices based on other salons near you is causing your business to lose money, it's time to restrategize. 

It's really easy to overcomplicate your pricing. 

Pricing should be based solely on how much you need to make to cover your expenses, pay yourself and your team, and create a cushion of cash to scale your business (aka profit). Or even invest in education opportunities! 

Moving into a Parts + Labor pricing method will have you never doubting your pricing again! 

Parts + Labor pricing is taking the time it takes to complete a service, plus the cost of the products used. It's the proven way to ensure your profit on every service. (See for yourself with our Profit Calculator)

Parts are calculated using a Hair Color Management Software, like SalonScale to calculate every scroop, squeeze, and drop of color.  

With so many techniques evolving, ever-changing color trends, and the skyrocketing costs of color products… you cannot afford to just assume your costs are covered from service to service.

The ‘Labor’ portion is calculated based on how much you need to make every hour to ensure your business expenses are being covered as well as the time of you and your staff. Setting your salon pricing as Parts +Labor helps to ensure that you’re doing more than just breaking even month to month.

Labor pricing also offers more consistent pay for stylists too. Regardless if you do 9 1-hour hair cuts or 3 color services, you and your stylists should be making consistent pay hour to hour. 

Parts + Labor Pricing offers more consistency and stability. It also allows you to have better control of everything coming in and out of your color bar! 

Interested in seeing how a Hair Color Management software can make your pricing easier? Click here to book a demo!