In my last post we talked about the need to put our prices up to pay for promotions, rather than risk taking the cost of them from our profit margin ... and I promised to show you how to put your prices up without causing a torrent of moans and grumbles from your clients, didn’t I?
So let’s get started.
There are two basic approaches I recommend when I'm working with salon owners and I call them:
- The ‘little and often’ approach.
- The ‘when is a price rise not a price rise’ approach.
Let’s go through them both to see which would suit you best.
The ‘little and Often’ approach works beautifully and it does exactly what it says on the tin! Try it and you’ll discover that every month you can pick an item on your price list and put it up. You don’t have to make a big announcement, you just do it and most of the time clients won’t notice or comment.
If anyone does notice and asks you why, just give them a reason. Blame the cost of oil, electricity, the minimum wage, the VAT rise, water rates or whatever’s in the news at that time and say “so we had to make a small adjustment.”
The challenge with this approach is that you have to be able to amend the price list you display in the salon and on your web site easily. You’d be amazed how many salon owners hold back on implementing price rises either because they’ve still got price lists left from the printers and they don’t want to waste them or they have a lot of hassle with their web people so it puts them off making small changes.
The answer is to print your own on your computer and the trick is to print them on good quality 100gsm paper or 140gsm card. Done this way, you can print off a few at a time, when needed and change any price you want quite easily. As far as your web site is concerned the answer is to have control of updating your own site which is very easy to do these days.
The ‘when is a price rise not a price rise’ approach works in a different way. The answer to the “when is a price rise, not a price rise” question is simple, it’s … “when it’s a promotion.”
This can be used in one of two ways.
If your salon has a ‘tiered’ price list with different prices for the same services you can ‘promote’ people up the price list and their prices automatically go up. You then make a big fuss in your newsletter about how fantastic and deserving it is that this person’s been promoted and how you’re sure everyone will be pleased for them. Human nature being what it is, they normally will be.
The second “when it’s a promotion” approach is to put a price up and then disguise it for a while with a promotion, before it reverts to the new higher price. You can be really creative with this by actually changing something about the service, giving it a new name and ‘promoting’ it as something new and better.
I hope these ideas have helped and let me clear; the one thing I wouldn’t recommend in the current climate is to put a flat percentage increase on every service.
Simon is now the UK's foremost business coach for salon owners. His latest book The Salon Owner Guide To Beating The Recession was published recently and all Phorest customers are welcome to a free coaching session with him.To arrange your FREE session send an Email with the title Free Coaching Session to email@example.com