Beauty salon market challenges uncovered at PB focus group

Rising business rates, staff retention and coping with “dirty tactics” from competitor salons are the biggest challenges facing beauty businesses, according to findings from Professional Beauty’s first salon owners networking event for 2020. 

The event, which took place at Professional Beauty headquarters in Wimbledon, London, on January 28, brought together 12 salon owners to discuss the big issues affecting small businesses’ bottom line. Attendees ranged from senior salon owners who have worked in beauty for more than 25 years, to those whose businesses have only been open for nine months. 

One of the biggest challenges discussed was how the big brands are treating their key salon accounts. One owner said she spends more than £50,000 a year with a skincare brand but, despite this big investment, doesn’t get access to exclusive offers, feeling like the company isn’t focused on the salon market anymore. 

With dramatic increases in business rates and the National Living Wage in the past year, many stressed how they have had to work harder to keep their businesses financially on target. Some are trying to increase their retail sales, in some cases to as much as 50%, but admit it’s a tough feat, especially with grey-market sales plaguing the industry, while others are looking to partner with, or employ full-time, an aesthetic nurse or medical practitioner in their salon to offer botox and fillers, as more clients are seeking out these popular procedures.

The issue of competition came up too, but in more troubling ways than just a price war. One salon owner said a competitor paid, via Google AdWords, to have their advert appear when clients searched for her business name, while another explained how a salon copied her brand and treatment menu, everything from the logo to the interior design. Both said they were “raging” at first, but not rising to the bait and sticking true to their offering has helped clients see through the games and return to them more loyal than ever. 

Staff recruitment and retention is a continuing issue for salons, with the recruitment crisis still affecting businesses up and down the country. One salon owner suggested that the solution could lie with the older market, with many mums wanting to return to the working environment but lacking the confidence to do so as so much focus is on hiring millennials and generation Z. 

One salon owner said: “This group of people are happy to work weekends and evenings, which are usually the shift younger staff don’t want, because dad is at home and can look after the kids.” However, with adult education suffering from funding cuts – investment having dropped by 45% between 2009 and 2018, according to the Institute for Fiscal Studies – finding skilled, mature beauty therapists could be difficult.