8 Money-Saving Tips for Salons

Created: Thursday, 08 April 2021 16:20

As a salon owner, keeping costs low helps you improve your profit margins. Your clients pay you for their results instead of how much you spend on your inventory, supplies and marketing efforts. Making smart investments in the beginning leads to better results in the long term. These eight money-saving tips can help you build a sustainable business that gives clients the best experience. Let's take a look at how salons can save money. 

What Are the Top Expenses for Salons?

Opening a salon is an exciting new venture. To help ensure the success of your business, you'll want to stay on top of costs. Let's look at some of the expenses of starting and running a salon: 

• Salon equipment and supplies: The amount you spend on these expenses will vary based on the type of salon. Equipment includes everything you need, including hood dryers, shampoo, coloring stations and scissors. 
• Technology and point-of-sale (POS) system: This fee will cover your internet and other tech costs that allow you to accept payments.
• Remodeling: When starting in a new space, you'll want to make it your own. Redesigning the space will enhance your brand image. 
• Rent or mortgage and property taxes: This expense is likely your highest monthly cost, making up 3% to 6% of your monthly sales. The amount you spend will depend on your location, the foot traffic in the area and the building's quality. 
• Utilities: This expense includes water, electricity, heating and air conditioning. 
• Salaries and wages: You can either pay your stylists a salary or use a commission model based on the customers they bring in. 
• Payroll taxes: These taxes will vary depending on your business model. Self-employment taxes typically make up 7.6% of total sales. 

How Your Salon Can Save on Expenses

Tracking your expenses, understanding where you are spending money and reviewing how you can reduce excess spending will help you save. View money as a resource to help you improve your business. While you don't necessarily have to splurge to see results, there are areas where significant investments make sense for a long-lasting business.

It's wise to spend more initially by investing in quality equipment, upskilling your employees and finding optimal solutions to plan for the future. When saving on expenses, it's essential to consider your long-term goals and how to spend wisely now to ensure the longevity of your business. 

1. Keep Track of Your Expenses and Profits

Whether ordering towels in bulk, paying salaries or accepting payments, you must track business details. You can look for solutions that manage your accounting, sales, orders and payment responsibilities so that you can monitor your salon's financial health. Make adjustments as needed to help improve salon profitability.

Keeping track of your expenses gives you insight into where you are spending money, what areas you can cut down on and where you can invest more. You can spot trends in your business spending by tracking your costs, profits and losses over several months. Analyzing these trends equips you to plan for the future. When you know where you are spending your money, you can spend more responsibly. 

The first step to track expenses is to have a separate business account. Invest in accounting software that tracks and automates your business expenses. This software will make monitoring, analyzing and sorting business expenses easy and enable you to create reports. You can streamline expense tracking by connecting your bank account to your accounting software. Integrating the two will help organize your expenses. 

Keep all of your receipts, invoices and other documents. Maintaining records lets you accurately track your expenses. Plus, the IRS requires you to keep such documents for at least three years. You can use folders to file your documents or scan and store them digitally. 

2. Reduce Water Usage 

You may be wondering how to reduce water usage in a salon. Your salon can reduce water consumption by being more mindful of turning off the tap when applying or massaging products into a customer's hair. Using less hot water will also save you energy costs. You can also install WaterSense-approved showerheads to reduce water consumption, which improves sustainability in your beauty salon and gets you a tax deduction. Salons also use lots of towels. You can save energy and water by only running your washing machine when you have a full load.

Fix any leaks quickly, and check your taps and toilets to make sure there are no drips. Monitoring your water usage carefully can help make your salon more eco-friendly and save you money. 

3. Monitor Your Energy Usage

When you track your energy costs, you can spot what uses the most energy and take steps to minimize usage. Lighting should be practical and energy-efficient. LED lighting is an energy-efficient choice that uses up to 90% less energy than conventional incandescent lighting. Before purchasing your salon's equipment, consider your energy needs. Energy-efficient options may cost more upfront but will save you on costs over the equipment's lifetime. 

Regular practices such as turning off your lights and equipment at the end of the day or when you're not using them, lowering your thermostat to the lowest comfortable setting, and maintaining faulty equipment or lighting can all add up and help you achieve significant energy savings. 

4. Listen to Your Customers

How can you market your business without spending a ton on advertising? Focus on word-of-mouth marketing with customer management software that helps you treat your clients like royalty. Use social media to post pictures, run promotions, gain customer opinions using polls or surveys, and share your marketing message with your target audience. 

Complete careful research before you spend on marketing. Ask your customers for feedback and respond quickly to their concerns and questions. Poor customer service is why 62% of customers switch to different businesses. To retain customers and keep them loyal to your salon, you must make them feel valued and provide an excellent customer experience. For example, if customers prefer certain product lines, invest in the product they love and can afford.

A common mistake salon owners make is assuming customers want the most expensive designer lines. Many of your customers buy the products you use in your salon. Fortunately, there's a middle ground between designer products and more affordable options. Research can help you choose professional product lines that deliver excellent results at a reasonable price. If it makes sense to splurge on a new product or a customer favorite, you can still do so.

5. Choose High-Quality Equipment

Choose high-quality equipment that will last longer and run more efficiently. The initial cost may be significant, but the durability, safety and strength will save money in the long run and build brand positivity. The allure of buying secondhand or more affordable equipment will wear off as the equipment begins to break down and disrupt your workflow. You want your customers to look their best. High-quality and efficient equipment will help your team achieve the best results for years to come.

High-quality equipment, towels and decor will have a positive impression on customers and help your team work more efficiently. When sourcing equipment and supplies, look for reputable manufacturers with a long-standing salon industry history.

6. Invest in Your Employees

Hire the best team possible. Excellent employees will keep your customers coming back. Although your employees receive training before they start, ongoing staff development and training will sharpen their skills and advance their knowledge. The beauty industry is constantly evolving, and keeping your staff updated through training is an investment for your business, employees and customers. A well-trained team can keep up with industry changes, stay updated with the latest technology and help your business stay ahead of competitors.

Investing in your staff also increases their job satisfaction and keeps them motivated. When you put your staff first, you'll have a happier, more productive team that will likely stay loyal to your salon.

7. Buy Your Salon Supplies Online and in Bulk

Your salon goes through specific supplies faster than other businesses. Buying high-quality versions of those items in bulk can help you save money. Purchasing from one wholesaler streamlines your order process and inventory management and saves you time. You can get your supplies from one place instead of shopping around and constantly replenishing your inventory.

For example, you can purchase 100% cotton terry towels in bulk from Towel Super Center. Our appealing, salon-quality towels stand up to frequent washing, and you'll always have extras on hand when you buy in bulk.

8. Plan for the Future

Setting long-term goals for your salon will help you work toward a future strategy. You likely have big dreams for your business, but it will take daily habits, strategy and planning to achieve them. Don't be afraid to start small. Get the basics right, such as perfecting your customer experience, investing in your staff and monitoring expenses. Developing sustainable operations and having well-planned goals that you can implement daily improves productivity and keeps you focused on what you want to achieve. 

Knowing who you are is also essential for longevity. Having a culture that defines your unique behavior sustains your business over time. When you cultivate a strong culture, you set yourself apart from your competitors and attract the right talent to thrive in your salon. 

Buy Salon Towels From Towel Super Center

Salon-quality towels are a significant expense for businesses in the beauty industry. If you want to save, look to Towel Super Center. Our soft, absorbent towels are cost-efficient and ideal for successful salons. Order your salon towels in bulk today to take advantage of our wholesale pricing.