Positive outlook as beauty and hair sector remains steady, says NHBF report
The hair and beauty sector is in a positive position as it generally remains stable, according to the latest National Hair & Beauty Federation (NHBF) quarterly State of the Industry survey.
The signs of positivity, seen in previous surveys in April and July, have slowed across some indicators. However, overall the situation is steady, with a slight rise in businesses making a small or good profit (45%) and a similar number of businesses breaking even (42%).
Slightly fewer businesses are making a loss, which continues to be a move in the right direction.
The general trend towards increasing prices is levelling off, according to the stats. Over the previous three months, 55% of businesses raised their prices and a further 51% will do so over the next three months.
Reliance on external support continues to stabilise; over half of businesses (56%) are still either partially or completely reliant on Government support, but 44% say that they are not reliant on continued support. The most positive finding is that three quarters of those surveyed said they are confident in their survival.
However, while staffing and recruitment intentions also remain steady, they are still in negative territory. Only 27% were definitely or likely to take on new staff in the next three months (similar to 28% in July), and 63% say that it was unlikely or that they definitely would not be hiring.
The lack of experienced staff continues to be a huge problem for the industry, as outlined by the NHBF Careers at the Cutting-Edge report in May 2022.
Business comments around the survey largely focus on the burden of the VAT threshold, the challenge of being an employer salon, affording premises and staff overheads with concerns around businesses choosing to take on self-employed staff to avoid staff costs.
NHBF's director of policy and public affairs Rosina Robson commented: “While there is not the same headline growth as in the past two quarters, most of the indicators haven’t fallen and some of the net trends show an improvement.
She added, "This slower growth might reflect the summer months being a relatively quieter period. Businesses are still under pressure from all sides including stubbornly high inflation, energy costs, rising wage costs and the lack of availability of experienced staff to grow their business.
“Support on business rates and for energy bills has been very welcome over the last year, and we call on the Government to also renew the valuable 75% discount for retail into 2024/25. This would give certainty to sector businesses and enable them to grow and provide valuable employment.”
Local Data Company data published in September showed that in the first half of 2023, there was a rise in the number of beauty salons, nail salons and barbers, yet a decline in the number of hairdressers, on the high street.
This mirrored data from the Office of National Statistics (ONS) in 2022/23, showing that the sector is restructuring with the number of hairdressing businesses in decline, but beauty, nail and barber businesses continuing to increase. The number of smaller businesses has risen, with larger businesses decreasing.
The NHBF State of the Industry survey received 530 responses between September 11–25, 2023. It gathered views from a good representation of businesses in the personal care sector across all areas including city centres, town centres and villages in England, Northern Ireland, Scotland and Wales.