What Would You Do: Raising Your Prices
You’ve worked your butt off to get to where you are, and you feel like it’s finally time to raise your prices to reflect your abilities and experience behind the chair. But it’s not a decision you can implement overnight. Is this the best time to raise prices? Is business good for you right now? How big of an increase should you make? One stylist recently found herself contemplating these questions, so she reached out to the BTC community for help.
“I’ve been doing hair for three years and I would say I’m 60 percent booked. I’ve really never raised my prices cause I’ve been told I’m not busy enough. Is that right? Also, is January a good time to raise my prices since I’m slower? Any advice from experienced stylists? I work in a medium-sized salon but in a fairly small city. THANK YOU!”
Here’s what some of the BTC community members had to say!
Keep your price increase minimal at best
“When I was starting out as a newer stylist, the place where I worked used the formula: for six weeks, 80 percent of services booked were request clients. Then we could raise our prices accordingly, usually a two to five dollar bump on haircuts and 10 to 12 dollar bumps on color services,” shares Kisten Kerns. “Now that all of my weeks are more than 80 percent requests, I go with a standard three-year evaluation and raise my prices based on education.”
The last thing you want to do is surprise your clients (and potentially lose them!) with an unexpected price change. That’s why @whitneymmm raises her prices little by little every year so clients expect it. “I’ve had success raising my prices minimally, but yearly, to avoid any shock to our clients that comes with a huge price jump. (i.e. the price of a haircut goes up one to two dollars),” she says.
Alina Schmidt is a proponent of raising one’s prices because price increases are everywhere, including your on tools and supplies. “I think you’re doing the right thing. Everything goes up—groceries, rent, supplies—I also work in a small city where people say every two to three years you should increase your prices. One dollar for a haircut, five dollars for color, whatever your preference is.”
Instead of changing all your prices, base it off new vs. loyal clients. @dearmiju found success by keeping her prices the same for loyal clients (as a thank you for sticking with her), and charges a higher price to new clients who she sees randomly throughout the year. “I know [loyal clients] well and they are more understanding if I need to move my schedule for potential clients and education classes/trips I take,” she shares. “If I’m booked enough where I’m getting a bit exhausted from work, then I raise my prices for new clients or those who just randomly come in once a year.”
A fellow small town stylist, @simply.tiara has been in the business for 10 years, so she knows a thing or two about increasing your prices and when. “Yes, being more experienced and more knowledgeable definitely makes you more valuable, but you have to be realistic,” she says. “A dollar or two is fine…Pick a date and start making everyone aware that your prices will be increasing as of that date so your clients won’t be surprised. But before you raise your prices, take a real honest look at your business.”
Think twice if your business needs some improvement
“You should have full books and a waiting list,” advises Christen Eddy Gill. “The goal of raising prices is to lose some people and make room for a higher paying clientele. If you can’t afford to lose people, you should not raise your prices.”
“What you need to do is make sure you are charging enough to begin with and do some honest self-assessment as to why you’re only at 60 percent after three years. The people who are telling you not yet may see something you don’t,” shares @danagarmon.
As eager as you may be to change your prices, it is important to consider where you are business-wise to ensure it’s a smart move for you. “I think it is important to charge what you are worth, but you need to do it in the smartest way possible,” says Carlyn Ackerman. “If you can’t maintain a full clientele at your current prices, you should think twice about raising them. Eighty percent booked for 12 weeks is generally a good time to raise.”
@colourplacementaustralia suggests setting a goal to help you increase your current business and make that price increase more attainable and successful. “I would give yourself a target of 75 percent full and always have an annual price increase. Then your clients accept that as part of your salon culture. Then for next January, in October do some incentives/promotions/specials so that January has a steady flow of business.”
“I tend to be very ‘slow to grow’ in my approach to business but my gut feeling is no, don’t raise your prices yet. At a base price, you’ll be attracting a wide variety of clients, and when you find through working with that wide variety what you’re really, really good at doing, you should start putting more effort into getting more of THAT on your books,” advises @andrewdoeshair. “When you find that thing and work toward doing more of that thing, you’ll end up being booked a lot more than 60 percent because you’re doing work that you love, and then you’ll want to raise your prices. Not because you feel like you deserve a raise but because you’re a specialist at that thing that made you busy.”
Which month is the best?
So business is good and increasing your prices just feels right. There’s nothing like the new year to introduce changes in the salon, at least that’s the way Kyle Roberts views a price increase. “If you’re going to do it, [January] would be the month. If you do it during busier times, sometimes you forget to notify clients, and they always want to know if what they’re paying for goes up,” says Kyle.
However, some have a different opinion on changing your prices in January. Nicholas Gavin-Rocheleau thinks January is too late. Rather, apply the price change during the busiest time in the salon. “January is the worst time to raise your prices. December is better when they are already spending for the holidays, but let clients know at least two months in advance that you will be raising prices.”
“My philosophy has always been to raise my prices in late fall because NOBODY is going to leave their stylist right before the holidays,” notes Lisa Clough.
However, @chickirivera finds success by increasing her prices during the summer. “I will say in my experience the best time to raise prices is June. So I’d either post (if it was an across the board increase) or send/hand out individual letters on May 1 informing everyone that as of June first, etc.”