Given the persistent inflation, it’s inevitable for salons and spas to increase the price of their products and services to stay in business. On the other hand, inflation also affects customers. So, you must find ways to raise salon prices without losing customers.

This is important because studies confirm pricing as one of the reasons clients leave their regular salons. If you’re unsure what to do, this article is specifically for you. 

By the time you read to the end, you’ll have learned:

• The best time to increase your salon prices.
• How to raise salon prices and by how much.
• Effective strategies for implementing price increases.
• How to communicate the price changes to your customers.

How to raise salon prices: When is the best time?

It might be time to increase your salon prices if: 

1. The cost of living goes up 

Inflation generally means an increase in the cost of living. Consequently, the costs of products, rent, utilities, etc., will also climb. Paying more for the same things is your sign to raise your salon prices. 

2. You’re constantly overbooked

Having your salon services always booked weeks or months ahead puts you in a great position to demand more money without losing customers. 

The reason is simple: 

The high demand for your services means you’re offering something valuable at a low price. And your people know about it, which is why they want in. Even if you lose some customers, it most likely won’t be enough to hurt your revenue. 

3. You have what most salons don’t

If you specialise in one or more beauty services (e.g., scalp treatments) or sell exclusive products, you can afford to raise your prices.

4. You improved services or upgraded equipment 

Another reason to increase your prices is if you’ve recently upgraded your salon equipment or your employees received new training to improve techniques and get on top of beauty trends. 

These can justify raising prices to help cover the cost of growing salons.

5. You need to retain staff

To stay competitive in the Nigerian beauty industry, your salon must retain staff even as you increase its client base. One way to do this is to keep employees’ salaries fair. And you may have to raise prices a bit to do that. 

6. Your salon is losing money

You need to monitor your salon constantly to ensure there are no revenue losses. A tool like Splice can help you with routine comprehensive reports to give insight into your business. 

If it ever turns out you can’t cut your expenses down any further, you might need to raise prices to cover it. 

How much should salons increase existing prices?

It’s one thing to know it’s time to increase salon prices, but it’s quite another thing to know exactly how much you need to. 

Now, while there are no set rules, it’s advisable to keep the price hike under 10% at a time.

To learn more about salon pricing, check out our previous post on the topic.

How to raise salon prices: 8 tips to successfully increase prices in your beauty business 

Here are seven practical tips on how to increase your salon prices the right way: 

Tip 1: Assess your business thoroughly 

To ensure your business doesn’t lose most of its customers due to the price hike, ask yourself the following question: 

• Do you need to increase your prices? If yes, why? 
• Do you offer excellent value to your clients, as demonstrated over a long period through positive feedback?

If you answered no to one or both questions, you might want to review your decision to raise your prices. If you answered yes to both, read on. 

The Splice App will give you a detailed overview of your business, including expenses, to help you reach a decision.

Tip 2: Conduct local market research

Before you go ahead to raise your prices, find out how much other salons in your area or niche are charging for the same services. Comparing their prices with your own will give you a sense of how to proceed. 

Also, consider other factors such as working hours, salon expertise, reputation, and size that may help you set a price relevant to you and your clients.

Tip 3: Know your audience

This goes without saying. Your customers are the most important thing to consider when increasing your prices. Remember, the goal is to raise your prices without losing enough to impact your revenue. 

The majority of your target audience should be able to afford your new price list. Otherwise, you might have to change your target audience or pause the price change. 

Tip 4: Raise prices gradually and periodically

Increasing your prices routinely (e.g., annually or biannually) helps you avoid drastic price changes that’ll scare off most customers. 

Implement a price hike gradually, preferably about 10-20% at a time. For example, if you want to increase your frontal installation service from N30,000, it shouldn’t exceed N36,000.

If you need to exceed this range, ensure it’s ABSOLUTELY necessary. 

Tip 5: Increase the price of specific services 

You don’t always have to increase the prices of all your services at once. Increase only specific ones. 

For example, an increase in dye cost can cause your hair salon to charge more for hair-dyeing services, but haircuts can remain the same. 

Tip 6: Always add value 

As much as possible, add value to your service as you increase your prices. 

You can do this by adding small complimentary services (e.g., scalp massage) for the first month after the announcement or by giving your staff additional training. 

Typically, customers are more likely to pay more for services that have been upgraded.

Tip 7: Offer packages 

This entails bundling multiple services or products and selling them as a single package at a combined price. The approach can be an effective way to price without losing customers because: 

• Customers often perceive packages to have better value for money compared to purchasing each item or service separately.
• Packages make the purchasing process simpler and more convenient for customers, as they can get everything they need in one go.
• Usually, packages carry discounts or bonuses, making the offer even more attractive. 

Tip 8: Update your prices

If you’ve increased the prices for particular products or services, effect the changes across all business channels, including social media and website. A management tool like Splice makes it easy for you to streamline this process. 

How to raise salon prices: Announcing a price increase without losing clients

Now that you’ve decided to raise salon prices, here’s how to break the news to your customers like a pro: 

#1: Keep your team informed

Your staff is your best asset for communicating this price change. Discuss the change in detail, including how it can benefit them. Decide on a strategy for breaking the news to your client base.

#2: Inform your customers ahead 

A prior announcement will go a long way to help customers adjust to the price hike and encourage them to book an appointment before the prices change. Any time from two weeks to one month is good notice. 

Share the notice via all your marketing channels, including your website, social media, Google Business Profile, email, and booking portal. You can also use the Splice custom messaging feature.  

#3. Be clear

Your notice should contain the following: 

• The message. 
• The reason for the increase. 
• The exact date it’ll take effect. 
• Other relevant information. 

#4. Interact with customers

Some clients will have several questions and concerns regarding the price increase. Ensure your team is available to answer all questions. It may help to run through a list of possible questions and appropriate answers with your team.

Conclusion 

Salons have to increase their prices from time to time. However, how they implement these price changes can determine whether customers stick with them or find cheaper alternatives. This article provides a comprehensive strategy for how to raise salon prices without losing customers.