June 26, 2023 • 30 mins
Struggling to price your services as a beauty professional? Fear not! This episode is packed with insights on overcoming the fear of raising your prices and embracing your worth. We dive into the reasons behind discounted service prices, figuring out your cost per hour, and the impact of inflation on our industry. Plus, discover the fascinating 'lipstick effect' and why people still indulge in luxurious services, even during tough economic times.
Taking care of yourself and investing in your future as a beauty professional is crucial, not only for you but also for your clients. We discuss the importance of specializing and niching down, allowing you to charge more for your services and establish yourself as an expert. Learn about fearless business pricing strategies, how to confidently raise your prices while understanding your costs, and ensuring profitability. Be prepared for those essential conversations with clients about pricing changes and take control of your financial success as a stylist!
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Episode Transcript
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Speaker 1 (00:02):
Welcome to the smart, wealthy stylist podcast.
I'm your host, emily Cardin.
Over here.
We're dedicated to helpinghairstylists manage their
finances, stay organized,healthy and manage their time
and mental well-being.
We focus on staying healthy inall areas of life and maximizing
productivity.
If you're a hairstylist lookingfor these things, then this is
(00:23):
the podcast for you.
Together, we'll avoid burnoutand step into being the smartest
, wealthiest stylist that we canbe.
Speaker 2 (00:34):
Good morning.
Welcome back to the Smart,wealthy Stylist podcast I am
going over.
Is it time to raise my prices?
I know that this is such a hardtopic for so many of us,
including myself.
Anytime it comes to pricing asa beauty professional, i feel
(00:55):
like we are compassionate.
We love our clients And, to behonest, it's really hard to put
a price on your worth as astylist and put a price on the
services that we provide.
It's such a personal businessto be in And I've always been an
(01:18):
emotional discounter.
I have single moms, i haveretired clients, i have people
who have lost their husbands AndI just know.
I hear about the problems thatthey're going through and the
financial struggles And Iunderstand that that.
You know their hair is apriority to them And I feel like
(01:42):
it's my job to you know.
Give them a discount orwhatever.
That is so far from the truth.
As I have evolved in mybusiness and learned the about
pricing and how to figure outwhere I need to be and my cost
per hour and all these thingsthat I've traveled through this
(02:02):
last year, i have realized thatI have cut myself short so much
And I could probably already beat a debt if it weren't for the
amount of money that I emotionaldiscount my clients and have
over the course of the 13 yearsthat I've been doing hair.
I don't know why, as anindustry, that we do that.
(02:24):
I think that we're probably theonly service based industry
that discounts like that.
Well, probably not.
There's probably other servicebased industries that do that.
And you know, when it comes timeto do a price increase, why do
we just totally freak out?
You know I literally like hadhives and like had a meltdown.
Whenever I did my last priceincrease.
(02:45):
It was about a year ago And Imean it was like the most
stressful thing And I was, youknow, telling my clients, like,
okay, you know, i just want tolet you know I'm doing a price
increase.
I understand if it's too much.
Like you know, i posted iteverywhere.
I over explained, i had to tellthem how I had a loss in my
(03:08):
business and, like I just overexplained the whole situation.
No one else does that.
You know we go into Walmart, wepay the prices And you know
Walmart's not over there sayingdo you know how much it costs to
get a bottle of ketchup shippedto our store?
Like, do you even know how muchwe're having to pay our
employees.
Like no, like we literally justgo and pay the price.
(03:33):
I know my myself, like anytime Igo and get my hair done or
whatever services that I receiveas a consumer, i don't even ask
them how much it costs.
Like, and I'm on a strictbudget.
I realize that the servicesthat I want and the providers
that I go to, i want to go tothe best.
So, like, if I'm getting myhair done or say you know, i
(03:56):
want to get Botox or whatever,like I'm probably bringing $300
or $400.
I've saved for this.
I've, you know, stashed moneyaway, put it in an envelope.
I don't even ask what myservice providers are charging
me And I just expect to paywhatever.
So I have a lot of clients thatdo that And I didn't realize
(04:16):
that.
Actually, just last week one ofmy clients was like I don't
even know what you charge, butI'm going to pay whatever you
charge because you're worth it.
So I was just totally in myhead about that and just making
it way more difficult on myselfthat it needed to be.
And you know, right now, inthis economy, with all this
(04:38):
inflation, there's more moneybeing printed now than there has
ever been.
I mean, it's like the economyis so super inflated It's just
causing so many issues And It'scausing a lot of people
financial hardships.
Back in 2001, when the lot therewas a big recession then too,
(05:01):
and Estee Lauder came up with aconcept called the lipstick
effect.
And It's so interesting to meto see consumer behaviors and
buying behaviors, because thefounder of Estee Lauder was
talking about how, you know,they weren't selling the
luxurious items, like theyweren't selling their high
(05:22):
dollar foundations and all thisstuff.
But people were more willing tocommit to a lipstick.
You know they wanted a change.
They wanted to, you know, givethem self a treat.
It was, and that's what hecalled it.
It was a luxurious treat, andAnytime there's inflation, a lot
of times the lipstick effectgoes into effect.
People are looking for a change.
(05:43):
They're looking to treatthemselves.
You know, typically it isgetting their hair done, making
a change with their makeup orhair or their nails or whatever.
So you are included As aservice provider in That
lipstick effect.
So, even though there'sinflation and even though
(06:04):
there's technically a recessionright now, don't think that you
can't raise your prices Simplybecause there's this inflation
going on.
So how do you know when to raiseyour prices and how much should
we raise our prices?
Well, through my experience andhelping several other stylists
(06:25):
walk through this transition,the there's three key markers.
One of them is how far bookedout you are.
The second is are you taking aloss in your business or minimal
profits?
And the third is that you'rewanting to shift or into a
specialty or niche down.
So let's go over each of those.
If you're booked way out So ifyou're booked out more than
(06:48):
eight weeks and you can't getnew clients in and at least two
to four weeks, you're mostlikely in need of a price
increase.
If you're topped out of yourmarket pricing and you feel like
you're seeing less new clients,you'll need to up your
perceived value.
You will never hear me say, oh,your prices are too high, you
(07:13):
need to lower your prices.
Why don't you give a discountcode?
Why don't you?
you know?
No, you need to make as muchmoney as you can so that you can
better your future.
But if People aren't willing topay your prices, you're seeing
new guests Really fall off, likeyou're not getting any new
client requests.
It's most likely because yourperceived value is not there.
(07:37):
And that means perceived value,means like what amenities that
you're offering your clients,what services you're offering
your clients, what is your salonspace like?
What is your booking experience?
like you know, upping yourperceived value will help people
pay for their clients.
You will help people paywhatever.
(08:00):
So, like I have fresh bakedgoods baked for my clients every
week.
I have usually one to two itemsfor them to pick from.
I have a snack bar, a coffeebar, bottled water.
Every once in a while I'll evenhave like wine or mocktails or
whatever.
I do double book some.
But I have a huge salon studioso people have their own private
(08:22):
space.
It's not loud, you know.
It's a quiet experience.
The salon is beautiful, it'sclean.
You know the experience is partof the service and They're
allowed to book online.
I have a website with all veryclear pricing.
(08:43):
I have a social media with tonsof before and after pictures.
All the time I have peoplebring me inspiration pictures
off my own website or off of myrevivifyemily Instagram page and
You know, just having thatexperience for the clients is
something that you really can'tput a price on and You know I
(09:07):
know a lot of you are working insalons that you feel like your
growth is inhibited because Thesalon is loud or you know it's
dirty or There's.
You know it's just not the rightenvironment for you.
Like you really strugglegrowing your luxury clientele or
maybe you're not.
(09:27):
You're not into luxury, maybeyou're wanting to do more kids
here and you're in this like youknow Super fancy salon.
Maybe you need to shift intosomewhere That's more family
friendly.
You know Whatever it is thatyou're wanting to do, trying to
figure out What your message is,who you want to be speaking to
(09:48):
and then Looking at your salonand saying does this fit?
who I'm speaking to?
does this fit my perceivedvalue?
is the amount that I'm chargingcohesive with what I'm doing as
a stylist and what I'm offeringmy clients?
so if you really want to raiseyour prices and You feel like
(10:12):
you Aren't supporting what yourprices are with what your
services are, up your perceivedvalue make you know, really
stand out in your business andstand out in your niche or your
specialty and Just know thatIt's just as dangerous to close
your books because you're toobusy as it is to have empty
(10:35):
books.
If you close your books, you'rea dying business.
You know people move, peoplehave life changes and When
you're booked way, way out likethat, it has its own problems.
I am one of those people likeright now.
You know I've already done aprice increase, i have Nitched
down.
(10:55):
I do still serve some clientsthat I've served for years that
I really enjoy.
I'm not planning on firing them, you know.
And It is a hard thing tonavigate because you know I'm
sitting here, going okay, i'mliterally already booking into
the end of August, beginning ofSeptember, and we're in June.
(11:16):
And you know now it's forcingme to come in on my days off
because you know I have allthese new client requests coming
in for extensions, which iswhat I'm wanting to move more
into.
So it is a hard thing tonavigate, you know, but going
okay, i'm here.
At this crossroads Is it timeto do another price increase?
(11:37):
You know.
So, just evaluating yourbusiness, seeing where it's at,
seeing what your perceived valueis, making sure it's in line,
and then you know, if you'rebooked way out you're going to
have to make a move.
Another one is are you taking aloss in your business or even a
minimal profit, once you take itinto account all of your
(12:00):
expenses and then figure out howmuch you let you bring home.
Are you coming up empty handed?
This is one of the only serviceindustries that service
providers are okay with notmaking money.
I see stylists all the timethat are proud, you know, like I
was talking to one of my salonreps and she said you know?
(12:23):
I was talking to a lady and shesaid I've been doing here for
over 30 years and I have neverraised my prices And she was
proud of that, like that's somesort of a badge of honor.
If you're still charging $30 fora root touch up and you're
proud of that, i'm not shamingyou, but you are degrading the
(12:44):
hair industry and you arecutting yourself short When it
comes time to retire and youdon't have any money and you're
literally having to live off ofyour social security and food
stamps.
You're going to be wonderingwhy you didn't raise your prices
.
I don't know.
There are no doctors, lawyers,people working regular nine to
(13:05):
fives that are getting you know,401k, pension, whatever.
None of those people would goto work for free.
Why do we?
Why are you going to work forfree?
Because I don't understand.
I understand that the hairindustry is an industry of
passion and compassion for ourclients.
We're full of empathy for themand you know we're holding their
(13:27):
hands through marriages,divorce, babies, like we're in
it with these people.
They aren't just clients, and Icompletely agree.
But whenever you're retiringand you're having to live off
social security and you can'tpay your bills and you didn't
you're not debt free because youdidn't have enough money to pay
(13:49):
off your debts as you wereworking Are your clients going
to come and take you groceryshopping?
Are they going to pay yourmedical bills?
Are they going to be there tohelp you because you can't
afford in home healthcare?
I just want you to get realwith your thinking about your
future and thinking about whatyou're contributing to yourself,
(14:13):
because by shorting yourselftoday, it only affects your
future.
You're shorting yourself day today and you're shorting
yourself 30, 40, 50, 60 yearsfrom now.
However long you live.
You are shorting yourself.
We have to level up.
As an industry.
You can still love your clientsand be compassionate, but
(14:37):
charging them nothing for agreat value is insane And things
are expensive.
I look at my weekly bill for myhair color products and you
know all my processing solutionsand all the things I know you
can relate.
I know you're having the samebill that I have and it's
(14:58):
absolutely insane to not chargeenough to cover your expenses
and still take money home.
You should be taking home apaycheck because your business
should not.
You should not be spending outof your business account for
your personal stuff.
You should be paying yourself apaycheck weekly so that you can
(15:21):
actually have a paycheck tospend at home.
Every other industry that thereis, you know, or every other job
that there is, people take apaycheck home.
They have, you know, an actualpaycheck to pay their bills with
in their personal life And I'mnot talking in your business
life, your actual personal lifeand you know whenever your price
(15:42):
super low, typically you'revery, very busy and fear can be
completely overwhelming,overcoming, and I lost probably
50 clients when I doubled andtripled some of my services Last
year when I did my priceincrease.
Literally some of my colorservices tripled, but I was that
far behind I had not raised myprices and literally well, i'm
(16:07):
not going to be able to do that.
I guess I hadn't raised myprices in 10 years.
And then I did a small bump upand it still it wasn't even
close to enough.
And then, once I actually dugin and saw my numbers and
realized how far behind I was.
And then when I went into myaccountants office and she said,
hey, you had a loss of $4,000this year, that was absolutely
(16:30):
shocking.
So I'm actually making a profitnow and the fear of losing
clients should not be biggerthan the fear of not providing
for your family.
I just want you to think ofyour future.
Are you investing?
Do you have savings?
Will your clients be there tosupplement your income when
you're forced to live off socialsecurity?
(16:50):
Think long and hard on thosethings, because they are
absolutely relevant and it isabsolutely something that you
should be thinking about.
The third topic is a good reasonto raise your prices is because
you're shifting into aspecialty or you're niching down
.
So when you're specializing insomething, you can typically
(17:13):
charge more, especially ifthere's a demand for it.
So I'm kind of I don't want tosay transitioning into an
extension specialist.
I am an extension specialist.
I do invisible beat extensions.
I do still have some clientsthat don't have extensions, and
that's fine.
I still really enjoy servingthem.
(17:34):
So you can still serve yourclients that you love, that
you've done for years, and nichedown because basically the only
new clients I accept at thispoint are extension clients or
curly girls.
So I love cutting curly hairalso.
Those are two of my favoritepassions.
So I just don't accept anyoneunless they are a curly girl
(17:58):
haircut or they are an extensionclient.
I am still going to service mybase of clients that I have that
are not my specialty, because Ilove them and I enjoy doing
their hair and I find joy in mywork.
So there's nothing wrong withthat.
But by niching down, you can,you know, present yourself as an
(18:21):
expert and show these peoplethe amazing things that you can
do and the services that you canprovide and you know your
knowledge and expertise.
People pay more for a specialistin the medical field and dental
fields and you know really anyfield.
If it's a specialist, that'sall they do and that's what they
(18:43):
really hyper focus on.
I will pay more.
Say, I wanted Botox, i wouldprobably go to a person who
specializes in Botox.
Or, you know, if you wantedfiller, you would go to someone
who specializes in filler.
If you wanted plastic surgeryand you really wanted a tummy
tuck, you should probably go tosomeone who specializes in tummy
(19:03):
tucks.
You wouldn't go to someone whospecializes in noses for a tummy
tuck.
So it's the same in ourbusiness.
You need to find what you'repassionate about, you need to
niche down.
And once you niche down, youcan really you know only do the
services that you love and thencharge more for them.
(19:25):
People will pay for expertise.
They want to know that you'repassionate about it, that you're
excited about it, that you're,you know, doing continuing
education on it.
And whenever you pay forcontinuing education and
showcase that to your clientslike, hey, look at all this
continuing education that I'mdoing to bring you guys the very
(19:46):
best that I can, that brings agreat value and sense of
security to your clients.
So, like I said, by nichingdown on a specialty, you can
charge more for that becauseyou're giving them a greater
perceived value.
And, once again, you know thefear of losing clients who don't
(20:06):
fit what you're wanting toshift into is unrealistic.
And if you do dread them comingin or you're afraid to let
someone go, fear is somethingyou'll have to overcome.
And I'm preaching to myself too.
I struggle with that.
I always think well, you knowwhat if?
what if they're mad at me?
(20:26):
you know what's what if I upsetthem?
or what if the right peopledon't get in my chair.
Well, that's all unrealistic.
Overcoming fear is a hard thingto do, but once you do it, you
realize like it is literallyjust a mind game.
Fear is not reality, fear isfear.
Fear is confusion, fear is selfdoubt, self loathing, whatever
(20:49):
you know you're feeling, fear isnegative.
And when you're trying to makepositive shifts in your life and
in your business, fear willalways try to come up and steal
that joy or still that spark.
So by overcoming fear and justsaying no, i am doing this, i'm
committing to this, this is whatmy prices are going to be, this
(21:10):
is my goal for my business,this is my goal for my future.
I am going to commit and see itthrough, and I know that that's
easier said than done, becauseI'm dealing with that right now.
You know, i'm just like I'mbooked out.
I have all these people thatare trying to get in.
I don't have anywhere to putthem.
(21:30):
I'm coming in on my day off.
It's just like these spinningwheels, you know.
And by overcoming fear and justsaying, ok, you know, I've
analyzed my business, i've putthe pen to paper, this is where
I need to be.
You know, this is how many daysa week I want to work.
This is, you know, settingstrict guidelines on your
business, your hours, yourprices, and sticking to it You
(21:54):
will absolutely thrive.
So how do I go about raising myprices?
The very first one is figureout your cost.
You can go tosmartwithystylistcom and
subscribe to the website and Iwill send you my free cost per
hour calculator.
When you go on there, you cantype in your expenses and how
(22:17):
many days a week you work andall that stuff, and it will
actually tell you how much itcosts to run your business per
hour.
Then that gives you a reallygood sense of OK.
So this is how much it costs meper hour to run my business.
How much do I need to becharging my clients to make a
profit or even break even, ifthat's where you're at?
(22:38):
And then second is, adjust yourprices per per.
Adjust your prices for profit.
Why even be working if you'renot making a profit?
There's no point in that.
So just make sure that youraise them high enough that you
can actually make a living andtake home a paycheck.
Number three be fair to yourself.
(23:00):
So I think it's great to befair to your clients also.
But I know, when it comes toputting a price on yourself,
your services, what you'reproviding for others, it can be
extremely difficult, especiallyif you're not a confident person
.
So whenever you do your costper hour calculator and you see
(23:20):
how much it's costing you to runyour business per hour and you
say, oh my gosh, i'm going tohave to be charging, you know,
two hundred dollars for thisservice to make any profit,
don't self doubt yourself.
There's truth in numbers andYou have to charge what you need
to charge to make money.
(23:41):
Don't put a price tag on yourself worth.
Number four be prepared for aconversation.
So this is the hardest one forme.
I don't know if you guys canrelate, but having a face to
face conversation with someoneand saying, hey, you know you're
so valuable to me.
I hate that I'm having to do aprice increase again, you know
(24:04):
whatever?
Well, if you show weakness inyour conversations, it can cause
your client to feel uneasyabout committing to the price
increase.
And so whenever you introduceyour price increase to your
clients, i want you to be verymatter of fact and secure.
Stand up tall.
You know.
You don't have to say you know,i'm really sorry.
(24:26):
There's stuff so expensive andI just I really I'm, you know,
don't do that.
That's what I did the firsttime And I'd be like I took a
loss on my business and I didthis and and I'm not making any
money and da, da, da da, youknow.
No, they don't need to know allthat.
Because you're takingcontinuing education.
You are giving them the bestamenities and services that you
(24:49):
have to provide.
You're giving them a greatservice.
Do it with confidence.
You know your prices are worthwhat you're charging and you can
announce it with confidence.
So when you're preparing for aconversation, the first thing
that you should do is email yourclients.
You know, just let them know.
I'm implementing a priceincrease.
(25:09):
This is what my new prices are.
These are the packages.
This is what they include.
Thank you so much for being aclient.
If this is not fit in yourbudget, please let me know and
I'll refer you to someone whowill fit in your price range.
Very clear matter of fact.
And then post the same thing onsocial media.
Canva is a great way to makesocial media posts, instagram
(25:35):
posts.
It has email templates and youcan get a lot of that for free,
but I do pay for the pro version, because then you can keep your
branding consistent through allyour social media stuff with
the same texts, fonts and colorsand all those things.
But so, email first, post tosocial media maybe put a little
(25:56):
pricing bubbles in yourhighlights on Instagram and then
post a sign at the salon.
You can put a sign on yourmirror or, you know, like a menu
on your table on your salonstation.
And then, number four, the hardone is have a face to face
conversation and just say youknow, when they sit down in your
(26:17):
chair Hey, lisa, i just wantedto let you know that I will be
doing a price increase, so nexttime your service will be $250.
That's all you have to say, youknow.
And then kind of read the room.
You know if they are feelinguncomfortable, you can say you
know, i know that seems like alot And if that doesn't fit in
(26:37):
your budget, i completelyunderstand it And I would be
glad to refer you to someone who.
It will fit in your budget Ifyou're booked way out and you
know it may not be a bad thingto lose a few people, especially
if they aren't your targetmarket, if you do lose some of
your favorites or some of yourtarget market clients.
(26:57):
That's okay, because there willbe other people that will be
glad to pay your prices.
That will be your clients soon,so don't get too up in arms
about that.
And then, um, the fifth way tohave a conversation with them is
to remind them at checkout.
So let's go over that again,email and then post to social
media, post to sign at yoursalon, have a face to face
(27:19):
conversation and then remindthem at checkout.
So whenever you're checkingthem out, just say, okay, just a
reminder, next time yourservice is going to be $250.
And then you make theirappointment and they are out the
door.
So I know that that's hard, butI know you can do it.
And then the very last piece, um, to go about raising your
(27:42):
prices, is do it.
You have to actually take theleap and follow through what
you've committed to.
I am the worst about that, iwill.
You know.
I have all my stuff typed up, ihave all my social media posts
created, i have all the thingsready to go, but I have not
committed.
And even on mine, like, i'm notdoing a huge price increase,
(28:03):
but I have some clients thatI've been charging $120, which
is what I charge for my basecolor, and they're getting a
full head foil.
Well, my full head foils are$190.
And you know I have a retiredteacher, i have a single mom,
you know I have several peoplethat it just totally cringes me
(28:24):
out to think that they're goingto have to pay $190 to get their
hair done and that I may losethem.
But I love them so much.
You know, i love them as people, i love them as clients.
But I have to make an executivedecision in my business to say,
yes, i'm compassionate forthese people, but I have to do
what's best for my business.
(28:44):
They are not going to be theones paying my bills.
They are not going to be theones investing into my
retirement.
They are not going to be therefor me whenever I retire.
It's me.
I have to make sure that I'mtaking care of myself
financially to better myself,better my children's future you
know better mine and myhusband's life that we're
(29:06):
creating.
It's a difficult decision, butI know that it's the right one
And by committing to followthrough what I started, i know
that will bring me a great dealof peace and joy.
So I want to encourage you to dothe same.
If you are in need of a priceincrease, follow these steps and
(29:28):
do it.
I believe in you.
I hope that you believe inyourself and that you know that
you're worth every single pennythat you charge on your services
.
So I hope you guys have a greatday and I will talk to you next
week.
Let's get to raising thoseprices.
Thank you for listening intoday.
Speaker 1 (29:49):
If you have a burning question or a topic you want me
to cover?
leave a review and ask thequestion in the review.
This is the best way to getyour questions answered.
Just remember you are a smart,wealthy stylist and you are
capable of anything you set yourmind to.
I'll catch you later.
Don't be a stranger.
Welcome to the smart, wealthy stylist podcast.
I'm your host, emily Cardin.
Over here.
We're dedicated to helpinghairstylists manage their
finances, stay organized,healthy and manage their time
and mental well-being.
We focus on staying healthy inall areas of life and maximizing
productivity.
If you're a hairstylist lookingfor these things, then this is
(00:23):
the podcast for you.
Together, we'll avoid burnoutand step into being the smartest
, wealthiest stylist that we canbe.
Speaker 2 (00:34):
Good morning.
Welcome back to the Smart,wealthy Stylist podcast I am
going over.
Is it time to raise my prices?
I know that this is such a hardtopic for so many of us,
including myself.
Anytime it comes to pricing asa beauty professional, i feel
(00:55):
like we are compassionate.
We love our clients And, to behonest, it's really hard to put
a price on your worth as astylist and put a price on the
services that we provide.
It's such a personal businessto be in And I've always been an
(01:18):
emotional discounter.
I have single moms, i haveretired clients, i have people
who have lost their husbands AndI just know.
I hear about the problems thatthey're going through and the
financial struggles And Iunderstand that that.
You know their hair is apriority to them And I feel like
(01:42):
it's my job to you know.
Give them a discount orwhatever.
That is so far from the truth.
As I have evolved in mybusiness and learned the about
pricing and how to figure outwhere I need to be and my cost
per hour and all these thingsthat I've traveled through this
(02:02):
last year, i have realized thatI have cut myself short so much
And I could probably already beat a debt if it weren't for the
amount of money that I emotionaldiscount my clients and have
over the course of the 13 yearsthat I've been doing hair.
I don't know why, as anindustry, that we do that.
(02:24):
I think that we're probably theonly service based industry
that discounts like that.
Well, probably not.
There's probably other servicebased industries that do that.
And you know, when it comes timeto do a price increase, why do
we just totally freak out?
You know I literally like hadhives and like had a meltdown.
Whenever I did my last priceincrease.
(02:45):
It was about a year ago And Imean it was like the most
stressful thing And I was, youknow, telling my clients, like,
okay, you know, i just want tolet you know I'm doing a price
increase.
I understand if it's too much.
Like you know, i posted iteverywhere.
I over explained, i had to tellthem how I had a loss in my
(03:08):
business and, like I just overexplained the whole situation.
No one else does that.
You know we go into Walmart, wepay the prices And you know
Walmart's not over there sayingdo you know how much it costs to
get a bottle of ketchup shippedto our store?
Like, do you even know how muchwe're having to pay our
employees.
Like no, like we literally justgo and pay the price.
(03:33):
I know my myself, like anytime Igo and get my hair done or
whatever services that I receiveas a consumer, i don't even ask
them how much it costs.
Like, and I'm on a strictbudget.
I realize that the servicesthat I want and the providers
that I go to, i want to go tothe best.
So, like, if I'm getting myhair done or say you know, i
(03:56):
want to get Botox or whatever,like I'm probably bringing $300
or $400.
I've saved for this.
I've, you know, stashed moneyaway, put it in an envelope.
I don't even ask what myservice providers are charging
me And I just expect to paywhatever.
So I have a lot of clients thatdo that And I didn't realize
(04:16):
that.
Actually, just last week one ofmy clients was like I don't
even know what you charge, butI'm going to pay whatever you
charge because you're worth it.
So I was just totally in myhead about that and just making
it way more difficult on myselfthat it needed to be.
And you know, right now, inthis economy, with all this
(04:38):
inflation, there's more moneybeing printed now than there has
ever been.
I mean, it's like the economyis so super inflated It's just
causing so many issues And It'scausing a lot of people
financial hardships.
Back in 2001, when the lot therewas a big recession then too,
(05:01):
and Estee Lauder came up with aconcept called the lipstick
effect.
And It's so interesting to meto see consumer behaviors and
buying behaviors, because thefounder of Estee Lauder was
talking about how, you know,they weren't selling the
luxurious items, like theyweren't selling their high
(05:22):
dollar foundations and all thisstuff.
But people were more willing tocommit to a lipstick.
You know they wanted a change.
They wanted to, you know, givethem self a treat.
It was, and that's what hecalled it.
It was a luxurious treat, andAnytime there's inflation, a lot
of times the lipstick effectgoes into effect.
People are looking for a change.
(05:43):
They're looking to treatthemselves.
You know, typically it isgetting their hair done, making
a change with their makeup orhair or their nails or whatever.
So you are included As aservice provider in That
lipstick effect.
So, even though there'sinflation and even though
(06:04):
there's technically a recessionright now, don't think that you
can't raise your prices Simplybecause there's this inflation
going on.
So how do you know when to raiseyour prices and how much should
we raise our prices?
Well, through my experience andhelping several other stylists
(06:25):
walk through this transition,the there's three key markers.
One of them is how far bookedout you are.
The second is are you taking aloss in your business or minimal
profits?
And the third is that you'rewanting to shift or into a
specialty or niche down.
So let's go over each of those.
If you're booked way out So ifyou're booked out more than
(06:48):
eight weeks and you can't getnew clients in and at least two
to four weeks, you're mostlikely in need of a price
increase.
If you're topped out of yourmarket pricing and you feel like
you're seeing less new clients,you'll need to up your
perceived value.
You will never hear me say, oh,your prices are too high, you
(07:13):
need to lower your prices.
Why don't you give a discountcode?
Why don't you?
you know?
No, you need to make as muchmoney as you can so that you can
better your future.
But if People aren't willing topay your prices, you're seeing
new guests Really fall off, likeyou're not getting any new
client requests.
It's most likely because yourperceived value is not there.
(07:37):
And that means perceived value,means like what amenities that
you're offering your clients,what services you're offering
your clients, what is your salonspace like?
What is your booking experience?
like you know, upping yourperceived value will help people
pay for their clients.
You will help people paywhatever.
(08:00):
So, like I have fresh bakedgoods baked for my clients every
week.
I have usually one to two itemsfor them to pick from.
I have a snack bar, a coffeebar, bottled water.
Every once in a while I'll evenhave like wine or mocktails or
whatever.
I do double book some.
But I have a huge salon studioso people have their own private
(08:22):
space.
It's not loud, you know.
It's a quiet experience.
The salon is beautiful, it'sclean.
You know the experience is partof the service and They're
allowed to book online.
I have a website with all veryclear pricing.
(08:43):
I have a social media with tonsof before and after pictures.
All the time I have peoplebring me inspiration pictures
off my own website or off of myrevivifyemily Instagram page and
You know, just having thatexperience for the clients is
something that you really can'tput a price on and You know I
(09:07):
know a lot of you are working insalons that you feel like your
growth is inhibited because Thesalon is loud or you know it's
dirty or There's.
You know it's just not the rightenvironment for you.
Like you really strugglegrowing your luxury clientele or
maybe you're not.
(09:27):
You're not into luxury, maybeyou're wanting to do more kids
here and you're in this like youknow Super fancy salon.
Maybe you need to shift intosomewhere That's more family
friendly.
You know Whatever it is thatyou're wanting to do, trying to
figure out What your message is,who you want to be speaking to
(09:48):
and then Looking at your salonand saying does this fit?
who I'm speaking to?
does this fit my perceivedvalue?
is the amount that I'm chargingcohesive with what I'm doing as
a stylist and what I'm offeringmy clients?
so if you really want to raiseyour prices and You feel like
(10:12):
you Aren't supporting what yourprices are with what your
services are, up your perceivedvalue make you know, really
stand out in your business andstand out in your niche or your
specialty and Just know thatIt's just as dangerous to close
your books because you're toobusy as it is to have empty
(10:35):
books.
If you close your books, you'rea dying business.
You know people move, peoplehave life changes and When
you're booked way, way out likethat, it has its own problems.
I am one of those people likeright now.
You know I've already done aprice increase, i have Nitched
down.
(10:55):
I do still serve some clientsthat I've served for years that
I really enjoy.
I'm not planning on firing them, you know.
And It is a hard thing tonavigate because you know I'm
sitting here, going okay, i'mliterally already booking into
the end of August, beginning ofSeptember, and we're in June.
(11:16):
And you know now it's forcingme to come in on my days off
because you know I have allthese new client requests coming
in for extensions, which iswhat I'm wanting to move more
into.
So it is a hard thing tonavigate, you know, but going
okay, i'm here.
At this crossroads Is it timeto do another price increase?
(11:37):
You know.
So, just evaluating yourbusiness, seeing where it's at,
seeing what your perceived valueis, making sure it's in line,
and then you know, if you'rebooked way out you're going to
have to make a move.
Another one is are you taking aloss in your business or even a
minimal profit, once you take itinto account all of your
(12:00):
expenses and then figure out howmuch you let you bring home.
Are you coming up empty handed?
This is one of the only serviceindustries that service
providers are okay with notmaking money.
I see stylists all the timethat are proud, you know, like I
was talking to one of my salonreps and she said you know?
(12:23):
I was talking to a lady and shesaid I've been doing here for
over 30 years and I have neverraised my prices And she was
proud of that, like that's somesort of a badge of honor.
If you're still charging $30 fora root touch up and you're
proud of that, i'm not shamingyou, but you are degrading the
(12:44):
hair industry and you arecutting yourself short When it
comes time to retire and youdon't have any money and you're
literally having to live off ofyour social security and food
stamps.
You're going to be wonderingwhy you didn't raise your prices
.
I don't know.
There are no doctors, lawyers,people working regular nine to
(13:05):
fives that are getting you know,401k, pension, whatever.
None of those people would goto work for free.
Why do we?
Why are you going to work forfree?
Because I don't understand.
I understand that the hairindustry is an industry of
passion and compassion for ourclients.
We're full of empathy for themand you know we're holding their
(13:27):
hands through marriages,divorce, babies, like we're in
it with these people.
They aren't just clients, and Icompletely agree.
But whenever you're retiringand you're having to live off
social security and you can'tpay your bills and you didn't
you're not debt free because youdidn't have enough money to pay
(13:49):
off your debts as you wereworking Are your clients going
to come and take you groceryshopping?
Are they going to pay yourmedical bills?
Are they going to be there tohelp you because you can't
afford in home healthcare?
I just want you to get realwith your thinking about your
future and thinking about whatyou're contributing to yourself,
(14:13):
because by shorting yourselftoday, it only affects your
future.
You're shorting yourself day today and you're shorting
yourself 30, 40, 50, 60 yearsfrom now.
However long you live.
You are shorting yourself.
We have to level up.
As an industry.
You can still love your clientsand be compassionate, but
(14:37):
charging them nothing for agreat value is insane And things
are expensive.
I look at my weekly bill for myhair color products and you
know all my processing solutionsand all the things I know you
can relate.
I know you're having the samebill that I have and it's
(14:58):
absolutely insane to not chargeenough to cover your expenses
and still take money home.
You should be taking home apaycheck because your business
should not.
You should not be spending outof your business account for
your personal stuff.
You should be paying yourself apaycheck weekly so that you can
(15:21):
actually have a paycheck tospend at home.
Every other industry that thereis, you know, or every other job
that there is, people take apaycheck home.
They have, you know, an actualpaycheck to pay their bills with
in their personal life And I'mnot talking in your business
life, your actual personal lifeand you know whenever your price
(15:42):
super low, typically you'revery, very busy and fear can be
completely overwhelming,overcoming, and I lost probably
50 clients when I doubled andtripled some of my services Last
year when I did my priceincrease.
Literally some of my colorservices tripled, but I was that
far behind I had not raised myprices and literally well, i'm
(16:07):
not going to be able to do that.
I guess I hadn't raised myprices in 10 years.
And then I did a small bump upand it still it wasn't even
close to enough.
And then, once I actually dugin and saw my numbers and
realized how far behind I was.
And then when I went into myaccountants office and she said,
hey, you had a loss of $4,000this year, that was absolutely
(16:30):
shocking.
So I'm actually making a profitnow and the fear of losing
clients should not be biggerthan the fear of not providing
for your family.
I just want you to think ofyour future.
Are you investing?
Do you have savings?
Will your clients be there tosupplement your income when
you're forced to live off socialsecurity?
(16:50):
Think long and hard on thosethings, because they are
absolutely relevant and it isabsolutely something that you
should be thinking about.
The third topic is a good reasonto raise your prices is because
you're shifting into aspecialty or you're niching down
.
So when you're specializing insomething, you can typically
(17:13):
charge more, especially ifthere's a demand for it.
So I'm kind of I don't want tosay transitioning into an
extension specialist.
I am an extension specialist.
I do invisible beat extensions.
I do still have some clientsthat don't have extensions, and
that's fine.
I still really enjoy servingthem.
(17:34):
So you can still serve yourclients that you love, that
you've done for years, and nichedown because basically the only
new clients I accept at thispoint are extension clients or
curly girls.
So I love cutting curly hairalso.
Those are two of my favoritepassions.
So I just don't accept anyoneunless they are a curly girl
(17:58):
haircut or they are an extensionclient.
I am still going to service mybase of clients that I have that
are not my specialty, because Ilove them and I enjoy doing
their hair and I find joy in mywork.
So there's nothing wrong withthat.
But by niching down, you can,you know, present yourself as an
(18:21):
expert and show these peoplethe amazing things that you can
do and the services that you canprovide and you know your
knowledge and expertise.
People pay more for a specialistin the medical field and dental
fields and you know really anyfield.
If it's a specialist, that'sall they do and that's what they
(18:43):
really hyper focus on.
I will pay more.
Say, I wanted Botox, i wouldprobably go to a person who
specializes in Botox.
Or, you know, if you wantedfiller, you would go to someone
who specializes in filler.
If you wanted plastic surgeryand you really wanted a tummy
tuck, you should probably go tosomeone who specializes in tummy
(19:03):
tucks.
You wouldn't go to someone whospecializes in noses for a tummy
tuck.
So it's the same in ourbusiness.
You need to find what you'repassionate about, you need to
niche down.
And once you niche down, youcan really you know only do the
services that you love and thencharge more for them.
(19:25):
People will pay for expertise.
They want to know that you'repassionate about it, that you're
excited about it, that you're,you know, doing continuing
education on it.
And whenever you pay forcontinuing education and
showcase that to your clientslike, hey, look at all this
continuing education that I'mdoing to bring you guys the very
(19:46):
best that I can, that brings agreat value and sense of
security to your clients.
So, like I said, by nichingdown on a specialty, you can
charge more for that becauseyou're giving them a greater
perceived value.
And, once again, you know thefear of losing clients who don't
(20:06):
fit what you're wanting toshift into is unrealistic.
And if you do dread them comingin or you're afraid to let
someone go, fear is somethingyou'll have to overcome.
And I'm preaching to myself too.
I struggle with that.
I always think well, you knowwhat if?
what if they're mad at me?
(20:26):
you know what's what if I upsetthem?
or what if the right peopledon't get in my chair.
Well, that's all unrealistic.
Overcoming fear is a hard thingto do, but once you do it, you
realize like it is literallyjust a mind game.
Fear is not reality, fear isfear.
Fear is confusion, fear is selfdoubt, self loathing, whatever
(20:49):
you know you're feeling, fear isnegative.
And when you're trying to makepositive shifts in your life and
in your business, fear willalways try to come up and steal
that joy or still that spark.
So by overcoming fear and justsaying no, i am doing this, i'm
committing to this, this is whatmy prices are going to be, this
(21:10):
is my goal for my business,this is my goal for my future.
I am going to commit and see itthrough, and I know that that's
easier said than done, becauseI'm dealing with that right now.
You know, i'm just like I'mbooked out.
I have all these people thatare trying to get in.
I don't have anywhere to putthem.
(21:30):
I'm coming in on my day off.
It's just like these spinningwheels, you know.
And by overcoming fear and justsaying, ok, you know, I've
analyzed my business, i've putthe pen to paper, this is where
I need to be.
You know, this is how many daysa week I want to work.
This is, you know, settingstrict guidelines on your
business, your hours, yourprices, and sticking to it You
(21:54):
will absolutely thrive.
So how do I go about raising myprices?
The very first one is figureout your cost.
You can go tosmartwithystylistcom and
subscribe to the website and Iwill send you my free cost per
hour calculator.
When you go on there, you cantype in your expenses and how
(22:17):
many days a week you work andall that stuff, and it will
actually tell you how much itcosts to run your business per
hour.
Then that gives you a reallygood sense of OK.
So this is how much it costs meper hour to run my business.
How much do I need to becharging my clients to make a
profit or even break even, ifthat's where you're at?
(22:38):
And then second is, adjust yourprices per per.
Adjust your prices for profit.
Why even be working if you'renot making a profit?
There's no point in that.
So just make sure that youraise them high enough that you
can actually make a living andtake home a paycheck.
Number three be fair to yourself.
(23:00):
So I think it's great to befair to your clients also.
But I know, when it comes toputting a price on yourself,
your services, what you'reproviding for others, it can be
extremely difficult, especiallyif you're not a confident person
.
So whenever you do your costper hour calculator and you see
(23:20):
how much it's costing you to runyour business per hour and you
say, oh my gosh, i'm going tohave to be charging, you know,
two hundred dollars for thisservice to make any profit,
don't self doubt yourself.
There's truth in numbers andYou have to charge what you need
to charge to make money.
(23:41):
Don't put a price tag on yourself worth.
Number four be prepared for aconversation.
So this is the hardest one forme.
I don't know if you guys canrelate, but having a face to
face conversation with someoneand saying, hey, you know you're
so valuable to me.
I hate that I'm having to do aprice increase again, you know
(24:04):
whatever?
Well, if you show weakness inyour conversations, it can cause
your client to feel uneasyabout committing to the price
increase.
And so whenever you introduceyour price increase to your
clients, i want you to be verymatter of fact and secure.
Stand up tall.
You know.
You don't have to say you know,i'm really sorry.
(24:26):
There's stuff so expensive andI just I really I'm, you know,
don't do that.
That's what I did the firsttime And I'd be like I took a
loss on my business and I didthis and and I'm not making any
money and da, da, da da, youknow.
No, they don't need to know allthat.
Because you're takingcontinuing education.
You are giving them the bestamenities and services that you
(24:49):
have to provide.
You're giving them a greatservice.
Do it with confidence.
You know your prices are worthwhat you're charging and you can
announce it with confidence.
So when you're preparing for aconversation, the first thing
that you should do is email yourclients.
You know, just let them know.
I'm implementing a priceincrease.
(25:09):
This is what my new prices are.
These are the packages.
This is what they include.
Thank you so much for being aclient.
If this is not fit in yourbudget, please let me know and
I'll refer you to someone whowill fit in your price range.
Very clear matter of fact.
And then post the same thing onsocial media.
Canva is a great way to makesocial media posts, instagram
(25:35):
posts.
It has email templates and youcan get a lot of that for free,
but I do pay for the pro version, because then you can keep your
branding consistent through allyour social media stuff with
the same texts, fonts and colorsand all those things.
But so, email first, post tosocial media maybe put a little
(25:56):
pricing bubbles in yourhighlights on Instagram and then
post a sign at the salon.
You can put a sign on yourmirror or, you know, like a menu
on your table on your salonstation.
And then, number four, the hardone is have a face to face
conversation and just say youknow, when they sit down in your
(26:17):
chair Hey, lisa, i just wantedto let you know that I will be
doing a price increase, so nexttime your service will be $250.
That's all you have to say, youknow.
And then kind of read the room.
You know if they are feelinguncomfortable, you can say you
know, i know that seems like alot And if that doesn't fit in
(26:37):
your budget, i completelyunderstand it And I would be
glad to refer you to someone who.
It will fit in your budget Ifyou're booked way out and you
know it may not be a bad thingto lose a few people, especially
if they aren't your targetmarket, if you do lose some of
your favorites or some of yourtarget market clients.
(26:57):
That's okay, because there willbe other people that will be
glad to pay your prices.
That will be your clients soon,so don't get too up in arms
about that.
And then, um, the fifth way tohave a conversation with them is
to remind them at checkout.
So let's go over that again,email and then post to social
media, post to sign at yoursalon, have a face to face
(27:19):
conversation and then remindthem at checkout.
So whenever you're checkingthem out, just say, okay, just a
reminder, next time yourservice is going to be $250.
And then you make theirappointment and they are out the
door.
So I know that that's hard, butI know you can do it.
And then the very last piece, um, to go about raising your
(27:42):
prices, is do it.
You have to actually take theleap and follow through what
you've committed to.
I am the worst about that, iwill.
You know.
I have all my stuff typed up, ihave all my social media posts
created, i have all the thingsready to go, but I have not
committed.
And even on mine, like, i'm notdoing a huge price increase,
(28:03):
but I have some clients thatI've been charging $120, which
is what I charge for my basecolor, and they're getting a
full head foil.
Well, my full head foils are$190.
And you know I have a retiredteacher, i have a single mom,
you know I have several peoplethat it just totally cringes me
(28:24):
out to think that they're goingto have to pay $190 to get their
hair done and that I may losethem.
But I love them so much.
You know, i love them as people, i love them as clients.
But I have to make an executivedecision in my business to say,
yes, i'm compassionate forthese people, but I have to do
what's best for my business.
(28:44):
They are not going to be theones paying my bills.
They are not going to be theones investing into my
retirement.
They are not going to be therefor me whenever I retire.
It's me.
I have to make sure that I'mtaking care of myself
financially to better myself,better my children's future you
know better mine and myhusband's life that we're
(29:06):
creating.
It's a difficult decision, butI know that it's the right one
And by committing to followthrough what I started, i know
that will bring me a great dealof peace and joy.
So I want to encourage you to dothe same.
If you are in need of a priceincrease, follow these steps and
(29:28):
do it.
I believe in you.
I hope that you believe inyourself and that you know that
you're worth every single pennythat you charge on your services
.
So I hope you guys have a greatday and I will talk to you next
week.
Let's get to raising thoseprices.
Thank you for listening intoday.
Speaker 1 (29:49):
If you have a burning question or a topic you want me
to cover?
leave a review and ask thequestion in the review.
This is the best way to getyour questions answered.
Just remember you are a smart,wealthy stylist and you are
capable of anything you set yourmind to.
I'll catch you later.
Don't be a stranger.
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