Are you considering raising your prices as part of your strategy this year?
Do you want to know more on how to raise your prices?
These are just a few benefits of raising your prices:
- You will position yourself higher in the marketplace.
- Increased revenue and profit.
- Rewarding your team for their results.
- People will take your business more seriously.
- Customers will value and respect you as an authority and will want to book in.
- Your confidence and self worth will grow.
- Your team will respect you.
- Getting out of your comfort zone and pushing the boundaries will help you grow on a deeper level.
- Business takes balls and putting that on the line is important.
We are here to serve, but not be slaves.
As salon owners we are also in the game of creating and giving. We can face resistance around raising our prices and the perceived value of the problems we solve for our customers.
Don’t be afraid to charge what you are worth.
Sure you may lose some customers but if they don’t value your worth and services… we say goodbye and good luck.
We all have money blocks and they show up in many shapes and sizes!
Get your Money Mindset Cheat Sheet in the Salon Leadership Library. It’s an invaluable tool to help you discover your blocks and release wealth and prosperity into your life.
Realise this… charging what you are worth is just a small part in the process of breaking through those blocks.
Our businesses are like mirrors and reflect back to us what is in us. If you see an overwhelmed business owner that’s what you’ll get. If you see someone who wouldn’t pay $100 for a decent haircut… that will be your experience.
The world works on flow. In and out. You need to get just as used to receiving as giving and this includes money.
Think about when someone gives you a compliment. Do you accept it and politely say thank you… or do you brush it off. Accepting the compliment makes everyone feel good.
Are there salon owners you aspire to be and have a business like theirs? You can bet your last dollar they charge what they are worth. This means they have a profitable business too. Do you know how profitable your business is?
Are you willing to let these blocks go and charge what you are worth?
Do you really want success?
Step #1 Charge what you are worth!
Really look at what you are saying to the world when you undervalue your services. Remember you are not selling your time… you are solving a problem. What is having that problem solved worth to your customer?
Think about your ideal customer. They will pay you what you are worth and they will value having their problems solved.
We understand there can be some inner resistance and there are common questions we hear about raising your prices.
- When should I raise my prices?
- Should I tell my clients?
- How do I handle customer resistance if it comes up?
- Tell me how to own this price increase and confidently express it?
Should you do a gradual increase, or one big jump?
Small but often is the best policy. We have clients that do it yearly or 6 monthly to keep in line with other cost increases.
Your cut and style price is the one you most often quote and is your entry level service for many customers. Raise this a few dollars each time and no one will feel put out.
Have a – From price on your printed material to cover this as it can be a problem. We have all been in the situation where we have got the extra printing because it was cheaper but ended up with price lists we can’t use.
If you have a scaled price list then this covers this too. You will become more in demand as the owner… your prices need to reflect that.
Stylists will also grow to higher levels and charge more. This is easily explained to the clients as a ‘graduation’ for the stylists as they are busier and more in demand.
If they want to pay less they can go on to a lower level stylist for the same price they have been used to.
Technical services are more easily increased as they are not always the same each visit. Sometimes they have more foils or a treatment. The client will not always be charged a set amount and will not worry too much about an increase.
The product companies put their prices up every year so just pass on the increase and explain it this way.
Can you charge more for clients who just want YOU?
Yes and please do. If you are busy and in demand and want to filter out some clients who would be happy with the other stylists, this is a great method of passing them on.
We recently put up an owners price and offered a membership rate to current customers who want to sign up… otherwise they paid the increased rate each visit. Worked wonders at filtering out the clients and helping the owner to transition to less time on the floor.
The clients that stayed were happy to pay the increased amount and they felt special. You can apply a more significant price rise here and really enable yourself to increase profits.
How to deal with resistance from customers?
We have covered this with the grading in prices and it being small and often, but you will get some who will not be happy.
It’s a fact of life and a couple of dollars is not worth worrying over.
Give them the option of a lesser experienced stylist. You don’t need to spend the whole visit justifying yourself and explaining every detail of your costs.
Feel confident and move on.
‘Don’t say my prices are too high, just be honest, Say you can’t afford me. it makes more sense’.
Explain that you let them know in the email, and if they didn’t read it perhaps they might take more notice of your emails in the future.
We have 2 ways of ranking our customers.
The amount they spend in dollars and the amount they engage with the salon via emails, promos, events and social engagement.
The more engaged a customer is with the salon the less likely they are to leave, complain and be dissatisfied. We all want more of those customers so ones who do all that aren’t worth worrying about.
Cheap attracts cheap.
How and should I let my customers know?
We were discussing this with a partnership the other day…
One wanted to advise the customers and put prices up by the end of the week and one didn’t see it necessary.
Neither could see each others perspective but when we introduced the idea of using it to boost the months lagging sales they both could see the benefits.
Send out an email letting your customers know of the price increase and the date it will come into effect.
Give them an incentive to book in before the increase. Post it on social media if you have a good following of customers and you will reach more this way.
If you have the problem of customers not opening your emails, have you tried segmenting your list and using different subject lines to get the open rates up?
Think about other businesses.
Do you get notification from the dentist or physio when their prices increase. What about your car service? Do you ever know what this will cost?
Recently an online coach doubled the price of her course.
Great example valuing of her worth… but she gave lots of notice and gave people the chance to sign up before the price increased.
It sold like hotcakes and everyone thought they were getting a great deal for something that was actually the same price at the time.
What about team resistance?
If you have team members that are undercutting the prices and selling their services cheaper, that needs attention.
If they don’t value themselves or your business, they will not grow with you.
Front desk staff can deal with the billing, but if you don’t have a front desk team then you must make sure all your team are playing by the rules or hurt them where it hurts… in their pocket… not yours.
Lastly you need to consider the most important thing…
Is your business making a profit?
All this mindset work, customer and team management aside, it’s not a matter of how and when you put your prices up but can you afford not to?
So get your copy of the Money Mindset Cheat Sheet in the Salon Leadership Library. You’ll also find some other great resources, like the Consultation Guide, Interview Questions, and Profit Calculator, plus Leadership Skills, Tools and Strategies.