You've probably already heard the call to action for nail techs to charge their worth, not only in NZ but globally. You might follow some nail techs overseas and dream to make as much as them per set (US nail techs, am I right), but think it's just not possible for little old NZ.
You're probably thinking to yourself one of two things...
You're scared to know the truth about your business finances, or
You don't know why on earth you need to invest time to educate yourself on your business finances, you're getting by just fine thank you!
Either way, I ask that you give me some space and hear me out!
introducing where the problem begins...
Regardless of the type of salon/business you run, we definitely have a few things in common.
Us independent Nail Techs all love what we do. We have invested $1000s of our hard-earned dollars (usually personal savings!) in order to have the job of our dreams.
We have battled through setting up our businesses and growing our client bases.
We have an array of training providers, who we carefully selected the right one to suit our needs. We decided to train to be a nail tech for the love of nails and passion for creativity and connection with people.
Not a single one of us decided to train as a nail tech BECAUSE we wanted to start a business from the ground up and turn a profit to support our lifestyles.
We all thought that would be a nice easy side effect of trading our countless hours and devotion to the craft.
So, once we qualified as a Nail Tech, we all collectively had a secret ceremony of the burying of the heads in the sand - ignoring the finances completely and getting lost in the glitter.
However, New Zealand based Nail Techs, Australian based Nail Techs, AND UK based Nail Techs all have something really awful in common (and probably other localities too).
The industry is not well developed. There are volume or NSS salons, and then there are the majority of independent nail techs who either work from home, or a smaller number who rent a commercial space. There are very few professional level nail salons that employ independent/highly educated nail techs, or allow them to contract & have their space within the salon.
This means, for the most part, to be a nail tech in these places, you have to run your own business.
and then there's pricing
There are many, many aspects to running a business, that quite frankly is kinda scary how much we don't know, but are allowed to start a small business anyway... But pricing is one key aspect that wildly affects our revenue and profit margins.
Yes, we love what we do. But why does that somehow mean should we work for wages that we can't be financially independent on?
We have primarily only one pricing tier, with a second intermediate tier only recently being introduced within the last 5 years. The problem is, in those same 5 years, the technology behind the products we use has exponentially improved, along with completely new and improved services.
Techniques have drastically elevated - take cuticle prep for example. Something that would at most take 5 mins, now with e-file cuticle prep can take anywhere from 10 - 40mins - and the finished result is much more beautiful.
Services that used to be completed within an hour, now take 1.5 or even 2 hours. These sets used to be infilled every 2 weeks on the dot, and now our clients can go 3,4,5+ weeks easily.
Despite all of these advances, prices have only increased by $10-$20.
This. doesn't. even. keep. up. with. inflation.
As you can tell by now, I can go on, and on, and on about this topic.
But, let's cut to the chase because you don't have all day (even though I do, and all night...)
As a new nail tech, we set our pricing by doing research on other nail techs in the area, the services they offer, the finished result, their space... etc. We find a number about in the middle and then apply a discount because we are new and that's how we set our prices.
Over time we increase here and there by $5 or $10, but never any more than that, because increasing too much will "scare our clients away and no one will pay that much for nails", right?
The problem is that all the nail techs you based your pricing on did exactly the same thing when they started.
If we all base our pricing on each other - HOW ON EARTH IS ANYONE MAKING ANY MONEY?
Short answer is, most of us aren't.
Through running the Path to Profit workshop, we have seen as many attendees as ways to run salons. No two business owners are alike - there is a large variation in working hours, operating expenses, service times...
But, despite all the differences, we found that if you do not charge $100+ per hour for your services, you are either not making minimum wage, or you are on the track to burnout for overworking yourself.
There is this awful goal in our industry that we should be "fully booked" and working back to back 12 hour days with no time to eat or use the rest room.
Since when is running ourselves ragged a goal? Especially when the payslip does not reflect the compromise!
The underlying truth behind this goal is, if you weren't fully booked, your overheads would be over 50% of your service fee, and you would be paying yourself peanuts.
I hope you are starting to see the problem.
At the start of 2024, I was in exactly the same boat as everyone else. The difference is, I have a big scary commercial lease, and am a single income household. My weekly revenue seemed good, but I never had any spare cash and always seemed to be scraping by.
My background is corporate & I love a good excel spreadsheet, so I decided to cut the crap and work out my true profit margin for my services. Two good things came out of that - 1) I scared myself silly with the fact that I was only making about $10 an hour at my current prices, even though I was charging one of the highest rates in Auckland at the time ($90 for structured mani/biab), and 2) I had inadvertently created the basis of a template any other nail tech could use.
I decided I couldn't keep this to myself. I am super passionate about this industry - it isn't just a fun hobby, we offer a luxury service, are highly talented, and deserve fair compensation for our work. We deserve to be financially independent.
We deserve more than what's currently on offer.
The cool thing is, since we all run our own businesses - if we don't like it, we can change it!
The first group of Path To Profit Nail Techs had to be SO BRAVE to increase our prices (I completed the workshop for my salon alongside the first group). It was like leaping off a cliff in the dark, not knowing what was there to greet us at the bottom.
We united with the idea that we simply could not afford to keep working this way, and might as well give our businesses everything we've got before we shut up shop and go back to cushy employed work.
But now, we have solid proof that the world will not end if you increase your prices. My core service (structured gel manicure) has gone from $90 to $125 since January. Art pricing has doubled.
As of this week, my average client spend has gone from $106.14 in January to $146.17 in June.
Yes, I have lost clients - however. I have only lost TWO from the price increase alone. The others had to readjust their disposable income spend due to the economy - so even if I had not made a single change, they would have gone anyway.
Most nail techs expect that doing a large price increase is a business killer, but for me it has saved my business. I have maintained sales revenue despite losing a 3rd of my client base.
All this has done, is open up space for new clients who value what I provide and the way I operate.
It is possible to make fair money doing what we do - and we don't have to break our backs to get it.
And, if you would like to join us on the path to a more profitable future, you can take the first step with our Weekly Hourly Rate Calculator - use your weekly revenue, hours worked, plus annual costs and operating expenses to work out how much you should actually pay yourself per hour for the week of work.
Or, join our waitlist for the Path to Profit and invest in your business financial knowledge to literally build success into your pricing!
I hope that you have learnt something from my rambles!
If you have any questions - email me at info@gelincsupplies.com or dm me on insta @gel_inc_supplies
Feel free to comment your thoughts below!
til next time...
Steph xo
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