Stylist Pricing, its not just a number.

In this episode I will show you how to decide if you need a price increase or not! I also go over all the feelings you may feel when considering a price increase! Being a service provider is hard yet so rewarding. Make sure you are charging your worth so you can make your biggest dreams come true behind the chair and in your personal life! 

Transcript

 Welcome to the Smart Wealthy Stylist Podcast. I'm your host, Emily Carton. Over here we are dedicated to helping hair stylists manage their finances, stay organized, healthy, and manage their time and mental wellbeing. We focus on staying healthy in all areas of life and maximizing productivity. If you're a hair stylist looking for these things, then this is the podcast for you.

Together we'll avoid burnout and step into being the smartest, wealthiest stylist that we can be. Welcome back to the Smart Wealthy Stylist Podcast. You have just got me, Emily, here with you today. I do not have any guest hosts. Uh, today I am going over pricing. It can be, I feel like such a controversial topic.

Um, there's so many facets to it and everybody has their take on it, so I'm gonna give you mine. Um, I struggled with pricing for so, so long. I just never really valued myself or could put a price on how I valued my service. That was such a hard thing for me to navigate because when you're a chronic people pleaser, it's really hard to say, okay, well I'm worth this and I'm gonna charge this and everybody's gonna like it.

Right? Well, that's just not in my dna, I feel like. So when it came to pricing, until I had professional coaching through Thriver Society, I never knew how to charge. That there were different forms of charging. There was just no self-education going on there for a long time. I never did self-education. So once I got into that and realized that there was all these different types of pricing that you can implement, I decided to go with package pricing.

Um, With package pricing. I really prefer that over anything else, and I really did a deep dive on those to look at what works best for me. There's oli carte pricing, which is basically where people pay. Each individual thing. So if they come in and get a haircut, it's 20 bucks. If they get a root touch up, it's $80.

If they want to add face framing highlights, that's another 55. If they, you know what I'm saying? If they get a blow dry and a style, and like you just add each thing up at the checkout, each individual item costs something and then you ring it up that way. The second way would to be to charge hourly. So regardless of what they're getting you, they are paying you by your time.

And then the third would be package pricing, which is what I do and prefer. Um, I have four color packages available now. I actually am just getting ready to roll out my fourth one. I used to just have three, and it includes, like the first one is a root touch up or all over color. It's $120. It includes their color.

A shampoo, a haircut, a style, and they even get like a tutorial at the end if they, you know, have questions about how to style their hair or whatever. I'll walk them through that. I try to make sure I have plenty of time to be able to do that, and then each package after that, It just goes up. So like the mid-range package is one 90, but that covers like full head foils or like if you do one all over color and a different color on your ends, like any sort of dimensional type thing.

Well, I have this like weird in between stage where I have a few clients that. 10 foils or they just get a few pops of ice framing highlights or low lights or whatever. And I'm transitioning people from the one 20 that were getting just a few highlights into the one 50 package because I was taking a loss on that package.

So I'm gonna go into how I figured that, how I set my price. How to implement either Ola car, hourly package pricing, perceived value, how far out you're booked out, all of those things. We're gonna go over that in this episode. I am fully transparent. I wanna be sure to share with you my struggles, um, that way maybe I can kind of help you through yours as well.

So I think setting pricing is a really touchy thing. I always was in my client's pockets basically thinking like, oh my gosh, they can't pay me this. They can't pay me. Like you have to get out of your client's pockets and just understand that you're running a business and you can still love them and be grateful for them.

And if they support you, they will pay whatever you. And it's the craziest thing, like whenever you do finally raise your prices, how people are like, I can't believe that you charge that little, like, I'm so glad to pay whatever, like I'll pay whatever. So it's really cool to see how people react. Now there will be some who react negatively, who can be hate.

Um, whenever I did my first price increase last year, March of 2022, I lost probably like 50 people. But it was the best thing that ever happened for my business because I lost those people. I was able to get in the people that I really wanted to serve, like my target market clients. And, um, it was such an impactful moment for me.

And so this year, now that I'm implementing and rolling out my new package, In between people, cuz some people don't really need to pay the full one 90 cuz they're not getting full head highlights or you know, it's not taking me a full two hours to do their hair. So I needed this middle of the road package, so I wanted to make sure that people could afford to come to me, but I'm still taking care of my business and as long as people know that, They, their best interest is at heart, but you also have to take care of yourself, and there should be a level of respect for that.

And if your clients don't respect you, why do you want 'em in your chair anyway? So, um, Let's get into this. So pricing used to be an emotional decision for me. Um, or I would be like, okay, what's the person down the street charging? What are other stylists offering that do what I'm doing? And that is not a good way to set your prices.

You should never base your prices off of your emotions or, because Sally down the street charges 170 for a highlight. I think it is good to have a general knowledge of what people in your area are charging, but there's so much more that goes into it. There should be a system and a way to figure out what your pricing should be.

So, um, the very first thing that you need to do is you need to know your numbers. So if you haven't. Listen to the episode, how to untangle your finances. You absolutely need to do that. You need to know your numbers because if you don't know your numbers, you cannot move forward. Um, you have to know what your expenses are.

You can go off of your tax sheet from last year if you want, like your expense sheet. Um, but if you haven't filed your taxes or if you. Think that those numbers may be off. Make sure that you go through and really truly know your expenses in your business. If you know truly what your expenses are, this whole process will be much easier trying to figure out what you need to charge.

So, The second step is to go to www.smartwealthystylist.com and subscribe to the page. When you do that, you're going to get the cost per hour calculator and the tax tracker worksheet for free. I'm not charging for that. I really, really want you guys to help yourselves and charge your worth, and I think this is a great free resource that will help you Tremend.

If you don't wanna subscribe, that's totally fine. Um, I'm gonna walk you through how to do it manually just so you have an idea. The cost per hour calculator is nice because once you know how much you're making, Or how much your cost is per hour. You can then even further type in like how much your products are costing you and then you can see, you know, your true where you're at.

So it's pretty cool. Um, so anyway, if you don't wanna subscribe, what you're gonna do is take your number that you found in your expenses. So say you may, or your cost was $50,000 last year, you're gonna take that number. And divide it by 52 weeks. That's how many weeks are in the year. That's your weekly cost.

Then you divide that by how many days a week you work. And so if you work four days a week, you'll divide it by four. If you take, if you work three, divide it by three. If you work seven, divide it by seven, what however many days. And then, um, you take that number and divide it by how many days you work.

And then you take that number and divide it. How many hours a day you run your business. So for example, your yearly cost was 50,000. You take that 50,000 and divide it by 52. That number's 961.53. I work four days a week, so I'm just gonna divide that number by four, and that's $240 and 38 cents. And then I typically work six hours a day, so I divide that two 40.38 by six, and that's 40 0 6.

So $40 and 6 cents is how much it will cost you to run your business. Whether you charge hourly, a la carte package deals, this gives you an idea just to see what it cost you to run your business. Once you know how much it's costing you to run your business, you can then say, okay, so I'm charging $30 for haircuts.

And say you're a haircut specialist and you charge $30 for a haircut, and it takes you a whole hour to do that haircut, but it's costing you $40 to run your business. You're taking a loss. So in order for you to make any profit, you need to at least charge over $40. It's such an eye-opening thing when you.

Okay, like this is how much it's costing me to run my business per hour. I'm taking a loss on this. Or some of you may see this and go, oh my gosh, that's so awesome. I'm already making a profit. And like, congratulations, you're charging your worth. That's awesome. If you aren't and maybe you're way off and you're going, oh my, Maybe you're right on.

That's great too. So, so after I ran my business through this, I realized that I was taking a loss on my entry level package. So that is why I introduced the new mid-level package that way. People that I was doing the root touches on, that was fine because my cost with my product and everything, it wasn't, I wasn't taking a loss on it, but whenever I started using foils and bleach and a root touch up and all that stuff, I was taking a loss on it, but these people weren't getting full head foils that were there for two to two and a half hours.

These are people that are still there for an hour and a half to two hours, but I'm using a lot more product on them, so I had to create a new package to accommodate that and to make. It's still budget friendly for them because they really don't need to be in the one 90 package. I don't feel like that's fair for them, but I also have to make profit in my business, so that's why I did that.

Something else to consider whenever you're raising your prices is what you're perceived value is. So whenever I first started doing hair, well not even first started, whenever I was doing hair, before I had my in-home salon studio. I did not offer any amenities. I didn't have any sort of like, like I would coach my clients on how to fix their hair if they asked me, but it was never like a thing.

Um, I never offered snacks. I never offered deep conditioning treatments. There was absolutely no form of luxury creature comforts type stuff like my perceived value was you come in, you get your hair done, you go. Like that's it. And that is fine if that is what you want to do and that is your niche. And like your target market is a mom who's just running in to get her hair done.

She doesn't like all that luxury, fluffy stuff. Like she just wants her hair done to get out of there. Or maybe you are a barber and you do a lot of men's client. And they don't want the pampering experience or whatever, that's fine. But you're, once you realize and niche down on your target market and what your perceived value should be, that's when you can act on that.

So when implementing a price increase, Taking into account what you're offering your clients, how much time you're spending with them. Are you double bucking? Are you giving scalp and shoulder or hand massages? Are you offering coffee, drinks, mocktails or alcohol? Are you using amazing products? Are you, you know, using like vegan or chemical free?

Are you giving consultations at every appointment? What is your perceived value? There was a girl, she does hair also. She was talking about how a lot of her clients, whenever she raised her prices, she was like, I had so many people that were like about time, like the services that you offer and the luxury experience that you're providing, your prices were way too low.

So, you know, whenever you do your price increase, you could have a reaction like that. Also, if your perceived value is way. And you're still offering these very low prices. You're just cutting yourself short and your clients know what value they're getting. And I actually had a client that whenever I raised my prices, she was like, well, that makes me feel a little bit better.

Because I always thought like, why does she not charge very much? Is she not using good stuff on me? Like it's all about if you're providing a luxury service. But you are charging a run of the mill cost that takes away from the luxury experience by making sure that you're charging your worth and saying, yeah, I do charge 190 for a highlight.

Like, that's what it is, but this is what you get with this. People are more than willing to pay it. And not only that, it makes them feel. Know the right word to say, maybe elite. You know, it makes them feel like this luxury experience, it's a treat. You know, things that are expensive typically carry a weight, but if your niche in your market is not luxury, like you are not wanting to offer a luxury service, that is okay, just make sure that you're charging your worth.

Even if you're just running people in and out of there. Charge your. And also the perceived value that you put out there to people on social media or however it is that you put out your perceived value. Make sure it's something that you can keep up with. So with my perceived value, my end goal is to be able to not double book.

I want to spend quality time with my clients. I wanna sit down and visit with them. I wanna be sure we get in plenty of consultation time, plenty of styling time. I just really wanna love on them and make them feel very special. But right now, my demand is so great that I am having to still double book. I can't even provide the luxury service that I'm wanting to give my clients because I'm so overbooked.

That's a great problem to. But if you ever get to that point like myself, like that's why I am doing a price shift. I'm moving these people that were in one 20 that really need to be in this one 50 and moving those people that were really need to be in the one 90 into the one 90 category because some of them, and I emotionally discounted cuz they were family or friends or you know, they've been with me a long time.

We are the only industry that does emotional discounting. Why do we do. We don't enforce cancellation policies, we don't take ourselves seriously, and we just let clients run all over us. And so I just wanna make sure that you guys know that there is nothing wrong with. Enforcing policies in your business and making sure that you are charging your worth and that you can provide the services that you want to provide.

You don't have to do haircuts if you hate haircuts and you only wanna do extensions niche down on that extension area and try to offer only that. And back to how far out you're booked. If you're booked out for eight weeks solid and you have no room to get your dream clients in, this is a problem. And if you are closing your books because you are too busy, it is not a badge of honor.

That is a sign of a dying business. And I know that that is totally contrary to belief. But if any, every single time I see someone, Books are closed, can't get anyone else in for six months. I just, it kills me a little inside because I think, you know, which maybe they are serving their dream clientele, but people move, people die, people switch.

You know, stylists like, if you aren't accepting new clients, your business is dying. It's just as dangerous as not having anyone on your. When you're booked way out, it means you have great demand. So if you are booked eight weeks out or more and you have no room to get in your dream clients, you're like on the struggle bus.

You don't know what to do, you're ending up double booking. You're working yourself into the ground, you're coming in on your days off. You need to do a price increase. If your demand is there, you need to do a price increase. It will thin some of your clients out. Really, ideally, you should be able to get in a new client request within two weeks.

I'm not saying to only fill your books for two weeks, but don't be booked out eight weeks solid. When your dream client comes in and you say, Hey, um, I can't get you in for two months. They're gonna go somewhere else. And if you are getting more than five guests requests a month that you can't fit in, it's another price increase.

So don't be afraid to raise your prices. I think it's really important to be able to do that and for your clients to understand that you're doing continuing education, you are bringing them the very best service that you possibly. Regular price increases are gonna be a part of your business, but you're always going to up your perceived value.

There's a guy on Instagram, it's uh, Taylor Cuts, one with a Z. You cannot sit in his chair for less than $300, and he's just, he's a barber. He just does haircuts and it is amazing to me how he has people wind out the door, but he has a perceived value there. He's niched down on his dream clients. And there are people literally lined up to get in his chair.

Once you find your niche, you can charge your worth and do it without being afraid and do it without feeling guilt. You should never feel guilty about charging your worth, and that very first price increase that I did, I felt like I have always been a confident. But whenever I did that price increase, I realized, oh my gosh, maybe I'm not so confident.

Because putting a price on what you're worth is a challenging thing. So it's nice to lean back on calculators and an actual system to say, okay, this is what my cost is per hour. This is the minimum that I have to make to break even. It gives you a guide to follow because if. Like, I know you, I know the type of person you are.

You don't wanna do anything to offend people, you know, you don't want to seem greedy or whatever. Especially in this time of recession, like this is a hard time for everyone. But everything's going up. Even our costs are going up. But that, and I, I think it is make, you know, it's a good thing to make sure that your costs are covered.

But if you are running your business and making sure everything's in check, your costs are gonna be covered. I'm not saying raise your C prices because of inflation. Now, if your prices are so low that you're not even covering your product cost. You definitely need to do a price increase. So if you figured out that you do need to do a price increase, what do you do now?

Well, you have to announce it and I know what you're thinking. You're gonna lose everyone and nobody's gonna pay what you need. Yes, they will. You are worth every penny. You can charge your worth and I am giving you permission and encouragement to own it and do the hard things. You are Cap. Of running your business exactly how you want it.

You are capable of attracting your dream clients and you are capable of charging what you want. The way that you announce it to your clients is you can send out a text with a link to your new prices on your website, and if you don't have a website, you really, really, really need a website, and I'm not talking just your square website or your Vigar booking website.

You need to get on. And they have great templates to create a website. I highly recommend going through Thriver Society, even just doing the Web Academy, like she has separate things. But having a stellar website will absolutely make you stand out, um, above the crowd. People will really look at you with professionalism.

You can put all the things on there that you do and what you're about, and even if you're not serving your dream clients yet, by putting on your website, who you're wanting to attract, the dream clients will come in. Um, but the best way to do is, is. Tell your clients in a text with a link to your new prices on your website.

You can send an email. You can print off your prices. Um, I love making templates or using templates on Canva. I pay 1299 for the Pro Can Vote account and you can print off your new prices, make it look aesthetically peeling and match your brand. Um, put it in a, uh, frame and set it on your station. Then that's a great talking point, making sure it's big enough for your clients to read it.

And when you check your clients out, say, you know, I had to restructure my prices. Next time you come in, it will be X amount. If this doesn't fit your budget, I completely understand. If you need a referral to a stylist who will fit your budget, please let me know. I'd be glad to refer you out. Um, I appreciate your business so much.

Um, I just, you know, thank you from the bottom of my heart. Like, be kind, be courteous, but make sure that you do tell them in person also, because if you don't tell them in person, it's very impersonal and they're gonna feel like, like that, that they're not gonna feel loved If you're just like, Here's the prices in a text, and then you don't wanna talk about it.

Um, and one of the most important ones is do not emotional discount. I was literally the worst. I'm still working on it, but I, you know, figured up how much I'm losing out. And it's ab, it's literally thousands of dollars a year that I'm shorting myself and my business. And that, like what I have shorted myself would literally pay for all the rest of the credit card debt that we have had I not been shorting myself for the year, like thousands of dollars.

So say your clients, um, you discount your clients just $10, like just emotional discount. Say you charge 115, you're like, well, my prices used to be 130, so I'll just charge you 140 like you've been with me a long time. You know, let me do you a favor type. Say you discount your clients just $10. This could have a massive impact on your business.

Let's say, let's just give a for example here. Say you do four colors a day, four days a week, and you take two weeks off during the year and you discount each of them $10. You're looking out on missing $8,000. You shorted yourself $8,000 a. Because you just kind of felt bad for charging them that extra $10.

I myself am guilty of emotional discounting. I did it for years. You should never feel guilt about charging for what it takes you to make a profit in your business. There are no other industries where people emotional discount, waive cancellation policies or give discounts just because they've gone there for a long time.

You can do the hard things. So I'm gonna remind you again, if you want to use the pricing calculator, go to my website@www.smart wealthy stylist.com, and right there at the top, just subscribe to the page and it will send it right to your inbox. The, um, the cost per hour sheet and the tax tracker.

Worksheet and the tax tracker worksheet is actually where after I budget for the month, I enter in all my expenses monthly. So then whenever you go to do your taxes, you just hand them that sheet and everything's laid out right there. It's so easy and, and nice. Um, so let's wrap it up and I'm gonna give you some actionable steps on what to do and just refresh your mind as we go through.

First step is to untangle your finances and run your numbers through the calculator. Decide what pricing structure you want to implement if you do need to restructure your business. I love packages because it's just very simple and I am trying to get more to doing online booking. And if you have less options on your website, it reduces the customer overwhelm and it's.

My descriptions are very clear on what I charge. If you want to go to my website@www.revivifysalon.com, you can see how my website looks. Um, and you can use my website as inspiration. You know, whenever you create your own, I use Wix to create my websites, but you can just see on there what it looks like, how my pricing packages are, the services I.

And then when it comes time to check them out on my Vigar app, it's super easy to just click the package that they got and check out is a breeze. You're not going through and adding a bunch of stuff or, you know, however, it's, it's just so much simpler doing. Uh, package pricing. This, the third step is to assess your perceived value.

Are you maybe per, you know, giving this luxury service and way undercharging yourself, or are you, are you possibly overcharging yourself and not giving a very good service? Like, I'm not talking about skill, but I'm talking about what are you offering your clients? Just assess where you're at, write down your goals around that.

Like what are, who is your target market? Who would be your ideal client, and what can you do to get them in the door? What can you do to serve them? What can you do to make their experience better while they're in the salon? Um, fourth step is to assess how booked out you are and how many new. Request you're getting a month.

Is it time for an increase? Are you booked out eight plus weeks in getting five new client requests a month? It's time for an increased sister or brother. Uh, don't avoid this is the biggest one. Step five. Don't avoid doing it out of fear. You deserve more and you deserve better. If you are fearful about doing a price increase, I want you to do a little.

I want you to write down what the worst possible outcomes could be if you do a price increase. And then on the other side of the page, I want you to write down the best possible things. And when I did this, I wrote down like the worst possible case for, you know, doing a price increase. What could happen?

Everyone would stop coming to me. I wouldn't make enough money. My clients would be mad at me. My debt payoff would be slower, and then my best outcome was my clients would be receptive and have no problem paying. My clients would not be upset with me. They would actually encourage me and be proud of me for doing better in my business.

I get out of debt that much faster. I feel proud of the business I've created. Doing this little exercise can really bring to light the possibilities. If you do do. And you don't react outta fear. And let me tell you, fear is from the devil. He's out to still kill and destroy. And that means your dreams too, means your business.

It means everything that you are. You know, fear is one of the worst emotions to act on because most of the time fear isn't even real. It's not something that is true. It's just a lie that you've made up in your head. So I just wanna encourage you that you are. Every single penny that you charge, the value that you're going to bring to your clients is going to be so amazing.

And by charging your worth, you are going to make leaps and bounds moving towards your dreams and your life, and your finances and your business, whatever it is that you're saving for, or whatever it is that you're working towards. By charging your worth, you're going to supersize your life and make.

Everything that you've dreamed of, I would love to hear if this podcast has inspired you to do a price increase. Um, if you, what, what packages you decided to do, or if you decided to do hourly, or if you did anything at all in your business, I would absolutely love to hear from you. Send me a DM at Smart Wealthy Stylist on Instagram.

You can always message me on Facebook or email me at smart wealthy stylist gmail.com. I look so forward to hearing from you, and I hope that this episode has been enlightening and, um, I hope you guys have a fantastic day. I'll talk to you soon. Thank you for listening in today. If you have a burning question or a topic you want me to cover, leave a review and ask the question in the review.

This is the best way to get your questions answered. Just remember, you are a smart, wealthy stylist and you are capable of anything you set your mind to. I'll catch you later. Don't be a stranger.