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Keeping your spray tan pricing competitive in today’s market is imperative, but how can you navigate raising your spray tan prices during this economic pandemic?
As manufacturing plants worldwide reopen, businesses quickly jump into action to catch up on the long-overdue production of materials our industry uses daily. And, with these materials at such high demand, it’s nearly impossible to keep up, resulting in increased costs of materials and labor, with a slower than usual turnaround.
Economic Inflation: a continuing rise in the general price level usually attributed to an increase in the volume of money and credit relative to available goods and services. (websters dictionary https://www.merriam-webster.com/dictionary/inflation#learn-more )
Supply and Demand: in economics, the relationship between the quantity of a commodity that producers wish to sell at various prices and the quantity that consumers wish to buy. It is the main model of price determination used in economic theory. The price of a commodity is determined by the interaction of supply and Demand in a market. The resulting price is referred to as the equilibrium price and represents an agreement between producers and consumers of the good. In equilibrium the quantity of a good supplied by producers equals the quantity demanded by consumers. (Britannica website: https://www.britannica.com/topic/supply-and-demand
As a business owner in the beauty industry, you have probably already experienced a flux in your company’s overhead as your suppliers begin increasing costs and reflect this in your wholesale price. Effective June 2021, Sjolie Sunless also increased Professional Rewards Pricing to accommodate the increased prices of ingredients, packaging, and other materials necessary to create high-quality products. While we were hesitant to make this change, we are confident our product line remains reasonably and competitively priced. This price adjustment marks the first time in Sjolie history! So, unlike other manufacturers who increase yearly, we intend to continue this pattern of adjusting as infrequently as possible. But don’t fret; as a professional, you are still making at least 3X return on investment on Sjolie products; this is double the return compared to other major sunless brands. To learn more about ROI, visit our Blog Page or contact a Sjolie Sunless Representative.
We’ve released this article so Sjolie professionals can make an educated choice whether or not to adapt service prices and allow them to release the news to their paying customers confidently. Continue reading to learn more about how to implement your price changes.
Analyze your Expenses and Calculate your Changes
It can be overwhelming updating your service menu and retail items, so it is essential to understand your current expenses and overhead to relieve some of the pressure and make realistic changes. If you do not have healthy bookkeeping habits already, it would be best to analyze costs frequently and build a good routine of doing so. MySunless, QuickBooks, and intuit.com are great resources for responsible business tracking. For help determining your service cost, review our Cost per Service Breakdown when configuring your new service price. Most distributors can supply you with yearly invoices or Net purchase data upon request. Don’t forget about additional costs of services like travel fees, gas, etc., that may need to be factored in. By analyzing your overhead, you can see what profits, or not, that your company is bringing in and determine if changes to your business are needed.
Are you recording your business expenses correctly? Check out www.MySunless.com, a fully integrated point of sale with customer relations management tools and business tracking features specifically designed to help beauty businesses operate more successfully
In addition to your raw service cost, consider your worth and time when updating your prices. Are you licensed, certified, and educated? Does your experience and training level outweigh that of your local competitors? Asking yourself hard questions like, “Am I good at what I do?” or “Would I pay $x for this service?” will help you.
Prepare and Implement your New Business Model
A price increase shouldn’t be dramatic! Increases should remain reasonable and manageable for your clients without being alarming to maintain a happy relationship. Your expansion should cover the additional expenses you’ve begun inheriting along with some profit, of course.
It is not reasonable to increase your pricing substantially without reason. Over time, slow and steady growth is more practical to your clients, and remember to put yourself in your client’s shoes. Would you be comfortable with this price increase if you were a client? If the answer is no, then reevaluate at a fairer cost.
For the health of your client relationship, you must allow plenty of notice before implementing change. It’s essential to clearly state your spray tan price changes on all public avenues to ensure client visibility. Announce your pricing increases on your social media and website, send a personal text or email to your clients reminding them about when the price increase takes effect, and be available for any questions.
While we can only hope clients are respectful of our business decisions, you can’t please everyone, and you may see pushback after your announcements. Thank your clients, and let them know you appreciate their business, but be firm with your decision on your price increase and remove the fluff from any explanations of how you came up with your new numbers. An honest answer is the best answer!
Need additional pricing tips? Be sure to check out our other blogs for further information. And as always, contact our knowledgeable team to discuss your business ideas! We’re available five days a week! We can’t wait to talk with you!