Woman at desk in a salon with a pen and paper

How to Recover the Costs of COVID

How do you plan to recover the costs of COVID-19-related closures and expenses?

The BeautyCouncil take: it’s time to raise your prices.

We know that this isn’t an easy decision — we all love our loyal clients and appreciate that many of them are struggling financially right now as well.

Still, costs are accumulating, and they may not be as temporary as we would hope. For all of the uncertainty surrounding this pandemic, experts typically agree that we have a long way to go before things go back to normal — and more likely, that there will be a new normal entirely. Individually and as a community, we need to adapt.

Let’s start with the facts

It shouldn’t be surprising that most people would prefer not to be charged extra for services, especially in a time of economic uncertainty. An online survey of BC residents found that 62% of respondents were opposed to businesses charging a COVID-related surcharge. However, opposition lessened dramatically depending on the type of business doing the charging. Importantly, a majority of 51% were in support of a surcharge if it came from hair salons.

So, where does our community of beauty professionals stand? A survey we conducted among our members in June told us:

  • 67% of our members plan to recover costs through service charges (typically between $3-$5 per visit)
  • 50.7% are doing this through increased service prices
  • 16.3% are doing this through a COVID surcharge
  • And 33% don’t plan to charge extra at all

As an association run by our own community, it makes sense that, at BeautyCouncil, we agree with the majority here. But before agreeing, we put a lot of thought into the reasons why.

Why you should increase your service prices

What we know for sure is that business costs have increased. From extra time between appointments, to PPE and sanitization materials, to replacement robes and towels for higher laundering standards, to months of missed appointments while paying rent, to limits on staffing and inter-booking… and the list goes on! While some of these costs may eventually go away, we shouldn’t expect this anytime soon — just look to our neighbors to the south and the predictions of a second wave.

That’s why BeautyCouncil’s official recommendation is to raise service prices. But why raise prices instead of adding a temporary surcharge?

If you’ve recently raised or examined your prices and feel they are truly reflective of the value of your services, you may decide that a temporary surcharge is the answer. However, considering the likelihood that this surcharge will be relatively long-term, you may experience some customer frustration with the duration of this “temporary” charge. Plus, the survey conducted in BC found that people were generally opposed to COVID related surcharges — however, regular price increases are a normal part of business.

*If business finances and calculating costs versus profit is not a strong suit of yours, we recommend checking out the Salon Profit Project. (Tip: BeautyCouncil members receive a discount).

Further, while masks may not be required forever, higher expectations around sanitization aren’t going anywhere. And would we even want them to? If you are newly BeautySafe certified or have invested in learning our latest COVID protocols, you have added value to your services — the knowledge of how to keep your clients safe.

And finally, you should ask yourself: is it time to raise your prices anyway? We learned through our survey that, for many of you, COVID price increases will be your first in years. This is a good reminder to continuously examine the value of your services. Besides considering inflation and the increasing costs of operating a business (from supplies, to rent, to staff), ask yourself: how are my services better or more valuable than they were last year? And the year before?

Remember: ongoing education, additional skills and years of experience contribute to your expertise. Expertise is valuable!

BeautyCouncil believes in the value of our industry and in the services provided by beauty professionals. Not yet a member, but interested in elevating your career and the beauty industry as a whole? Join here.