The price you place on the heads of your customers won’t cost them their lives but it will definitely cost you yours. You devote your days to delivering a service with your skills – yielding the best possible returns isn’t just tough, it’s a tough call. Mike Taylor of Bond’s Barbers and Mike Taylor Education ( @miketayloreducation) speaks to many barbering peers on the subject and adds “The saying that a cheap haircut is a bad haircut isn’t true. It’s more that, for many barbers it’s buried deep in their psyche that they are not worth better prices and there is always an excuse. More competition, different region, customer resistance… I think assuming that the public is out hunting for the cheapest deal and won’t spend more is disrespectful to them. Take coffee for example. A Starbucks is pretty much the same from Scotland to Cornwall and every coffee shop is rammed. It’s something people enjoy and appreciate so they just buy it. It baffles me that a barber with 20 years’ experience doesn’t value all he brings to each cut. It’s not 20 or 30 minutes. It’s 20 years poured into those minutes!” Mike recommends that when a shop puts up prices, they just do it and move on. For the 80 year old regular with a few whiskers he offers them a ‘loyalty’ card but in his experience, everyone just accepts that prices go up. Fear of losing business is very real and one that Paul Cowen of Rum Razor Barbershop ( @rumrazorbarbershop) knows too well. He opened in 2015 and while the cost of running the business has gone up, he was too fearful to raise prices. Paul explains “You end up absorbing costs and just narrowing your margins, plus there was some resistance from staff but in the end I had to put up prices by £1 on November 7th. I did a mass email ahead of the increase. It turned out to be a record week without one complaint!”
Restructuring prices can happen for lots of reasons…for example shop refurbishments, new services, relocation and just plain increases mean that you lose some customers but not everyone is YOUR customer forever. Creating a picture of the price you should charge for the value you can bring will help you assess your worth. Check out the infographic above to help prompt your thinking.
Price (as you see it)
Your price is the one you set. Your customer isn’t doing that for you. Things to think about:
Brand positioning – that cheap Stone Island Puffa shipping from China on Ebay may be the bargain of the century but it could also be poor quality rubbish. Price says something about the authenticity and quality of the purchase.
Competitive environment – surveying the competition is healthy. You may choose to price mid-range, bottom range or even lead the market but don’t make your competitors pricing a straight-jacket.
Price sensitivity – it’s likely that you are more price sensitive than your customer base. Think about where your target shops, what they wear and where they spend their leisure money. It may help you make a judgement.
Cost of service – fixed and variable costs are a huge part of the equation. Keep a close eye on them or before you know it you are becoming a charity!
Inflation/cost of living – stuff and services go up, so why not your stuff and services?
Value (as your customer sees it)
The true value of your shop and services isn’t set by you, it can only be perceived by the customer. So it’s worth finding out that what you think YOUR CUSTOMER values in your shop and services and the value that YOU think you are delivering ARE THE SAME THING! Things to think about:
Location, location, location – in your converted garage or on the High Street. There is value in both depending on your target market.
Service experience – the artisan coffee, the great vibes, the speedy WIFI, the welcome smile. It all makes a difference.
Skills and training – updated skills, broad creative horizons, competition wins and regular education should be shared with customers so that they can value them.
Job experience – long experience doesn’t always equal a high price but shared experience and professional advice can help raise it.
Environment – the beautiful premium barber chairs and stunning (spotless) interior, the amazing branding and comfortable waiting area – can add value.
Range of services on offer – from line-ups to manicures and everything in between. There’s a customer for it all.
Ease of access – great parking, appointments, walk-ins, queue management, opening times, online booking, contactless payment – anything for an easy life adds value.
Reputation – those 5* reviews, amazing word-of-mouth, handsome Instagram gallery of work all take the risk out of a cut for customers and they are willing to pay for it.
So, now and then, take a view on your price vs value to see if you have the best balance for you.
This feature was previously published in the January to March 2018 issue of Modern Barber Magazine. Subscriptions are available for guaranteed delivery of every issue.