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Do You Suffer From Successusphobia?

Getting Over Your Fear of Raising Your Prices Is Absolutely Necessary For Business Success!

San Diego, CA It is a fact that one of the biggest fears of beauty professionals today is the fear of raising their prices.  You may envision losing your clients, causing offense and creating mayhem in your business. The reality is, raising prices is absolutely necessary for the success of your business and you may be very surprised to hear what always happens when prices are raised in the correct way!  Lauren Gartland is the founder of Inspiring Champions, a business training and coaching company working in the professional beauty industry.  “Raising your service prices, setting boundaries and saying no are absolute musts for the advancement of your professional career, as well as your life,” says Gartland.  She helps salon and spa professionals to determine when it is time to raise prices, how much to raise them, how often and how to tell your clientele. 

Gartland notes, “The time to raise your prices is when the demand is greater than the supply. When you are consistently booked 85% or more of the time over a two to three month period, it is time to raise prices.  Or, if you have not raised them in 12 to 18 months, then it is also time.”  To figure out what your average time really spent working is, Gartland instructs how to figure out your PHP, Potential Hours of Productivity.  Write down in columns the days you work with hours underneath, minus your lunch or break time.  If you work nine hours a day, five days a week, with a one hour lunch break that would equal forty hours.  “If you do not currently take a lunch break or other breaks, start taking them. Treat it as an appointment – for yourself,” notes Gartland.  Once you figure your PHP, then figure your RHP, Real Hours of Productivity.  These are the hours you actually worked. Keep track of your daily PHP and RHP.  To find your daily average, simply divide your Real Hours by your Potential Hours. For example, if your real hours for a day were 5.5 hours and your potential was 8 hours, then your average would be 69%, which is 5.5 divided by 8.  Inspiring Champions has detailed worksheets to help members do their tracking that keep it very simple and organized; these are available in their educational materials for course participants. 

After calculating your average each day, then do it again at the end of the week. For example, if your real hours for a week were 27 hours and your potential was 42, then your average would be 27 divided by 42, which is 64%.   “Keep track of your numbers consistently over a period of two months,” instructs Gartland.  “If your average is 85% or higher, then it is time to raise your prices, as your demand has exceeded your supply.”  Now that you’ve decided to raise your prices, think about how much you should raise them and how often.  “Do not drastically raise your prices at one time,” Gartland cautions.  “Start with a ten percent adjustment. This will instantly increase your profits and it won’t affect your clients’ service tickets too severely.”  Keep tracking your average hours booked and keep an eye on your percentages.  If you again reach an 85% booking rate in two to three months, then raise prices again.  You can raise them a few times in a year if your client demand continues to exceed your supply.   Gartland also cautions that you should expect to lose some clients.  The upside?  “You need to lose them!” she says.  “You may lose about 10% of your clients, yet consider this; you will be earning more while working less.  You also want to replace those clients with your ideal clients, those with the higher service tickets, such as for haircolor.” 

The next step to consider is how to tell your clients. Always tell them ahead of time, so an increase won’t be an unexpected surprise. Gartland instructs, “If you see clients every six weeks, then post an announcement six weeks before you will raise prices.  It’s important that your guests will see it at least once before the increase is effective.”  You could place signs on your station, send an email to your client list or mail out an announcement letter.  Word your announcement professionally and positively. Always open with a thank you for their business and acknowledgement of your appreciation.  State the exact date and details of the price increase.  Of course, if you have pre-sold a package for hair services you will need to honor the price the package reflects. Almost always, an unexpected result happens when stylists raise their prices.  “We assume that people are going to ask why?” notes Gartland. “Typically, they do not say anything. They actually expect prices to be raised.  Do not be attached to what your clients choose to do.  If the worst case scenario happens and you do lose a few clients, remember that your goal is to fill your book with ideal clients. You will still be making more money while balancing your time better. Treat your career as a business and not as a hobby. Set boundaries, learn to say no and do not be afraid.”  Decide today to make an investment in your business and your life. Overcome those doubts and fears and create a life that works for YOU!

 

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Raising Your Prices

Raising Your Prices

Know when and how to raise your prices to maximize your profitability by working less for more.

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EDITORIAL NOTE:
Inspiring Champions is a business and coaching company offering live training camps, coaching and mentoring services, webinars, audio tapes and educational resources.

For more information:
800-496-9305
www.InspiringChampions.com
info@inspiringchampoins.com
.

Jenny Hogan is the Media Director at Marketing Solutions, Inc., a full-service marketing, advertising and PR agency specializing in the professional beauty business.

For more information:
call 703-359-6000,
visit www.MktgSols.com
email MktgSols@MktgSols.com.

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