Inflation and your salon, spa or clinic
Inflation has hit a 30-year high in New Zealand, and while that isn’t good news for anyone, there are some things salon, spa and clinic owners can do to soften the blow a little.
If your fixed-term agreements were made several years ago, it’s worth renegotiating as some of those supplies will now be so expensive you’ll be running at a loss.
There is no sense in keeping going if a contract will put you out of business (which also means your supplier permanently loses a customer, so it’s in their best interest to hear you out).
Look at your price list
We know, your customers are also dealing with inflation, but there may be some costs that you can pass on to your customer base.
Small scale but multiple, frequent increases might be more palatable as people have time to adjust. Quarterly rises can be smaller than annual rises and allow more flexibility at both ends of the cycle.
Decide to take a hit – where it hurts less
Identify a service and accept a loss or lower margins there, and then compensate by upselling and cross-selling other products and services, getting an increased basket size with your customer base.
This is a typical strategy for supermarkets, where customers come in for lower cost staples but are walked past the bakery and meal sections on the way to purchase. Identify your “milk and bread” products and use them to stimulate sales of more profitable products or services.
Check out different suppliers
Loyalty is great, if they’re giving you as good deal. If you can get your wax, shampoos, oils or the like at a better price elsewhere, consider it. Or at the very least, take this competing quote to your current supplier and ask them to match it. Chances are they’ll come to the party if they know they risk losing you a a client.