Why are so many hair salons are going out of business?

Many local hair salons and even long-established chains around the world are closing their doors. At a time where we idolize people’s hairstyles on Instagram, and where “treat yo’ self” is a commonly spoken phrase on Twitter, it has people begging the question: Why are so many hair salons failing?

While running a hair salon does have a number of challenges exclusive to its trade, many of the difficulties that are encountered are pervasive across many businesses, regardless of the industry.

Staff turnover, struggling to retain clients, increased costs of doing business, poor leadership skills, drastic changes in the work environment (internal and/or external), are just some of the things that businesses are up against while trying to keep afloat.

So now, let’s take a closer look at the big reason why hair salons are closing their doors:

Stylists leave and take salon clients with them

This is one of the most highly discussed frustrations in the salon-owning world. While it seems like a straightforward point, the effects hit hard on two fronts: businesses are losing employees that they invested time and money in, and they are also losing customers, and therefore, their profits.

This happens so frequently in the styling industry that it is considered standard practice: a stylist builds a relationship with their client, and then when an opportunity to go elsewhere arises, the stylist leaves and their clients follow. While this is beneficial for the stylist themselves, it isn’t so for the whole salon.

This often stems from a lack of a code of ethics amongst stylists in a salon—when everyone is just looking for themselves. Many salons are now building in a legal contract with their employees to prevent poaching of salon clients.

Lack of Business Management and/or Leadership skills

Just because a person is an absolutely amazing stylist, doesn’t mean that they have the skillset to lead a team, or run a business. Often successful business owners will invest in themselves or invest in a third party to help run their salon.

They may enroll themselves in business-related courses, or hire someone to run the operational side of things, so they can focus on what they do best. Salons often fail when they think this skill set is unnecessary, or don’t want to invest the money.

This also ties into apathy and denial on the part of the salon owners. Often, owners are comfortable doing what they are doing and aren’t willing to do anything outside of that. This, and they may think that their business is immune to the pitfalls that other salons are facing.

Lack of investment in the stylists

If a salon isn’t interested in investing in their stylists, it risks-high turnover or risks not being able to recruit anyone at all. One way to invest in employees is by having a strong apprenticeship program. Not every employee, however, appreciates the same type of investment from their employers.

Many successful salon owners recommend open dialogue with their employees in order to find out what it is that they want/what they value. Sometimes it’s more money, sometimes it’s work/life balance, but unless owners are having these conversations with their staff, they won’t be able to meet their expectations.

Everyone’s gone “social”, and salons can’t keep up

It is clear that we have moved forward into a much more “Social Media” focused era, and the truth of the matter is that many businesses just can’t keep up. If a salon doesn’t have a social media presence or hasn’t dedicated the time to build up an internet profile, it will be hard for their clientele to find them.

When in the past, people looked to their friends for the word of mouth recommendations, people now look to their news feeds. Someone mentions a hairdresser, and the first thing that is often asked is “What is their Instagram name?” If a salon has nothing to show, a potential client will likely move on to the next business with an impressive online portfolio.

Stylists leaving to follow Internet fame

Tying into the above, there have been many reports of stylists leaving their salon due to a surge in their social media popularity.

Some stylists have unrealistic expectations of their career path, often underestimating the time it takes to get recognized, and/or overestimating the amount of money they are hoping to make.

Having a social media profile gain lots of exposure often lulls stylists into a false sense of fame, so they leave their salon in pursuit of more money and more notoriety.

Youtube DIY: people are doing their own hair

With tools like Youtube out there, knowledge can be accessed much more easily than it could be 10 years ago. Due to ease, and cost-effectiveness, many would-be clients are now opting to learn how to do their own hair.

As a salon, it is hard to fight against the DIYers, so many are opting to take a different approach: improving the client experience. By giving their clients an improved experience and atmosphere, whether it’s providing beverages, a head massage, or something else they can’t get at home, salons are adding value to the visit.

Fewer people are relaxing their hair

While this point doesn’t reflect all salon closes, it definitely has impacted many black-owned ones. Many salons had stylists who were hair-relaxing experts but did not necessarily know their way around styling kinky hair without breaking out the straightening iron.

At the time, this was more than enough knowledge to keep business afloat. Now, however, stylists need to be confident with all types of hair textures, in order to keep turning a profit. If a salon is really prioritizing its business, it will invest in teaching its stylists these skills.

Overall, there is a multitude of reasons why salons are closing their doors today, and this list isn’t exhaustive. This doesn’t mean, however, that every salon is destined to fail.

With hard work and a conscientious mentality, a successful business can be made out of any salon. The owner just needs to be open to what might not be working for them, and be willing to make any necessary adjustments for the sake of their business.

– Ebena

Ebena is an appointment booking and online scheduling software for independent beauty professionals and hair salons.