Who says there is no inflation so we can’t raise prices?
Price Hikes are happening.
As reported in Money Magazine
Updated in 2017 Inflation is at 4% and some products are even higher:
Fuel oil +22%
Gasoline +11%
Coffee +16%
Milk +13%
How are people responding?
39% cutting back on spending
28% adding more to retirement/savings
17% paid down/off credit cards
20% gave more to charity
16% gave less to charity
14% refinanced the house
14% changed health insurance
So as salon and spa owners we need to raise prices (or quit serving coffee) at least 4%. Plus we need to have a small increase each year so clients don’t get sticker shock when we have to raise prices 20% because we have held the prices down for 8 years!
We also need to appeal to the frugality of people by offering unbundled services and price levels. Packages, series, and memberships also help people justify spending while feeling like they are cutting back.
Don’t rule out the new trend of Frugality Fatigue with the more well off. They have been good for EIGHT years saving, refinancing, cutting back and NOW many of them are ready to spend – just in a reasonable way.
Fred Dengler MIKAL contact me at fredd@mikal.com