A new industry report has shone a light on the financial pressures shaping UK salons, and the practical tools that could help beauty professionals build stronger, more sustainable businesses
A new report published by Timely, in partnership with financial education platform The Curve, has exposed the growing financial insecurity facing the UK’s hair and beauty sector.
‘Is Beauty On The Brink? The Quiet Crisis Facing Britain’s Self-Care Industry’ reveals that 21% of UK salons are currently running at a loss, and estimates that two in five salons could fold within the next 12 months without intervention.
Despite contributing over £30 billion to UK GDP and employing almost half a million people, the report highlights that behind the sector’s economic value lies a workforce of microbusinesses and solo practitioners operating on extremely thin margins.
The findings are based on industry data analysed by Timely and The Curve, combined with insights from Timely platform users and financial benchmarks referenced throughout the whitepaper.
Structural fragility: 95% of beauty businesses are microbusinesses
The report reveals that 95% of UK beauty businesses are microbusinesses, many run by solo practitioners.
This structure leaves salon owners particularly vulnerable to shifts in operating costs. A rent rise, sudden utility increase or even a single cancelled appointment can erase profits entirely.
While consumer demand remains strong – with personal care spending rising 8% in 2024 – this does not directly translate into financial stability for professionals.
Many deliberately under-price treatments to remain “affordable”, but hidden overheads and unpaid admin hours mean real earnings often fall below minimum wage.
The under-pricing crisis: skilled services undervalued
The whitepaper highlights severe under-pricing across key treatments:
- A gel manicure may appear to generate £70 for just over an hour’s work, but once materials, rent, electricity, insurance and unpaid admin are factored in, earnings fall dramatically.
- A 60-minute massage averages £111.05 for solo practitioners, but profit drops sharply after oils, laundry, travel and room hire are deducted.
- A wash, cut and blow-dry averages £64.32 for 73 minutes’ work, but hairdressers face similar margin pressures.
Compared to the 15.1% average net return across UK service industries, hairdressing margins sit closer to 8-10%, underscoring a significant profitability gap.
This systemic undervaluation, the report argues, is fuelled by a cultural misconception that hair and beauty services are a ‘luxury’ rather than a professional trade requiring regulated skill, investment and ongoing training.
The wider economic risk of inaction
The report warns that failure to support the sector will have ripple effects across the economy:
- 90% of beauty industry employees are women, placing a particularly vulnerable workforce at risk of unemployment.
- Salons act as anchor tenants on high streets, yet the UK high street vacancy rate already stands at 13%. Salon closures would accelerate this decline.
- UK beauty exports have fallen 5.9% annually since 2020; a collapse in service businesses could weaken the pipeline of demand and innovation further.
Industry experts call for urgent intervention
Oliver Smith, UK&I managing director at Timely, says the findings reflect a long-standing issue: “Our report reveals a stark picture of an industry on the brink… A fundamental pitfall facing these business owners is a distinct lack of financial literacy, and with that comes financial insecurity.”
He adds, “This sector is a resilient one and with the right intervention now, we truly believe it will thrive once more.”
Sophie Hallwright, co-founder and co-chief executive of The Curve, echoes this: “Financial literacy is not just a skill; it’s a lifeline. The beauty industry, predominantly led by women, is often undervalued and under-supported.”
Financial literacy push
Alongside the report, Timely has launched a seven-part financial literacy course designed with The Curve. Delivered via the Timely platform, the course provides training in:
- sustainable pricing
- profit management
- cashflow and budgeting
- understanding overheads
- building long-term business resilience
The report argues that embedding financial education into NVQs, VTCT qualifications and apprenticeships is essential to protect future professionals.
Recognising beauty as an essential UK trade
The report calls on policymakers, training bodies and industry stakeholders to recognise hair and beauty as a skilled trade, not a luxury sector.
Targeted grants, tax relief, clearer business education pathways and formal recognition are highlighted as essential steps for protecting this £30bn cornerstone of the UK economy.
“To act – to embed support, recognition, and infrastructure – is to give beauty professionals the future they deserve,” the whitepaper concludes.
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