The Win/Win of Wrestling Additional Profits from Unexpected Places

In an attempt to drive up profitability in the salon, there are certain areas ‘experts’ typically focus on: reducing staff costs, pushing retail, or recruiting and retaining clients. But for some reason, we’ve all avoided talking about color, despite the obvious high costs and small profit margins.

Drilling further into the knotty problem of profit in color and suddenly it’s clear that color-profit vs. income differs hugely from one stylist to the next and from one salon to the next, suggesting it’s not as simple as color not being profitable. If the experts could fix the disparity, the margins would look much more favorable. It’s time to talk about wrestling greater profits from your technical department.

New Strategies for Pricing Color Services

Flexible charging for color has been one of the greatest innovations in recent years. Instead of a blanket menu price for a service regardless of texture, length, porosity or thickness, salons are now using technology to capture every gram dispensed at the color bar and passing some (or all) of those product charges on to the client.

D Anthony in Nyack, New York, uses color management system Vish, allowing Owner Derek Anthony to set a threshold for product used, and once that is passed additional charges kick in automatically. In the first 30 days after reopening from lockdown, the salon performed 551 services, capturing an additional $4,126 in profit through extra product charges. Since then, color revenue has consistently remained at $3,000 per month more than pre-Vish days.

Capturing All Color Services

It’s not just charging for extra color mixed, but catching all products used on a client during their visit that affects profitability. Salons have always struggled against missed services that stylists either forgot or didn’t want to add to the bill. Paula Adams, owner of Signature Salon in Newfoundland, Canada, knew some of her stylists charged for extras while others didn’t.

“When I brought in technology I found it didn’t even out as I’d believed previously,” she explains. “Automating the system so the front desk is alert to every gram dispensed has taken the onus off the stylist and made sure we charge for every service. We have seen massive gains in color revenue since.”

Recognize Your Profit Eaters

Measuring color without technology means focusing on what’s left in the bowl, but it doesn’t tell the whole story. Over-application is a real and expensive problem. A stylist may look as if they have minimal waste but they could be simply putting too much on the hair without it being obvious, and therefore eating up profits. Tech helped Indira Salons in Illinois and Wisconsin immediately identify those over-dispensing and allowed owner Mike Nass to refocus on their color education.

"We had a scoop bucket for waste before color technology but you can’t always be sure every stylist has emptied their waste into the bucket, or monitor who is disposing of the most waste. By using Vish we can track our team and encourage those who waste more to be more careful, which is better for business," adds Nass.

Wiping Out Waste

Reports of color costs plummeting following the introduction of technology because color waste is down are not exaggerated. Stats from Vish show the cost of waste per service drops from dollars to cents by the second cycle of appointments. For instance, the team at The Village Salon in Pennington, New Jersey, has cut waste by nearly 30%, from $0.51/service down to just $ 0.36/service, with the top performing stylist wasting just $0.21/service. 

At Rain Salon in Meridian, Idaho, tech has brought extra revenue while bringing down waste. "It is difficult to get stylists to accept what they’ve always done and what they were taught might not be correct and so they stick to the way they’ve always done it, even if it means there is always left-over color," says owner Michele Duke. "There wasn’t pressure to change when the salon was paying for the color. But when suddenly it was the client paying for it the team were much more motivated to cut back on what they dispensed. Understandably, they don’t want their clients to pay more than they need to. Vish has cut my weekly color costs from around $3,000 to $1,500."

Using new technology to control and monitor color has transformed it from a break-even service (at best) to one that is highly profitable, and in doing so has put the whole technical department high on the list of quick-fixes favored by the experts.