How To Setup Salon Pricing In 2023

Salon Pricing

There are a few important things you should think about when setting salon prices. For example, a salon’s location and target market will help you decide which services to offer and how much to charge for each one.

Other things that could affect your hair salon price list are whether a product or service is in high demand, what your competitors are doing, and the overall value of each item that you’re selling. Let’s talk about each of these in more detail:

Service Value

It can be tempting to lower your prices to get those first bookings, which are very important, but remember that you still have to pay your bills. Ultimately, if you want your salon to make money, you can’t charge less than you spend.

As a salon owner, you need to know the Break-Even Point, or BEP, for each item on your menu. Find out how much each service costs you in terms of materials, staff, and time, and make sure your prices at least cover these costs. From that point on, whatever you make will be your profit.

Where is it?

Pay close attention to where your business is located. This can tell you a lot about your clients and how to set prices. You can probably charge a bit more if your store is in a nice or busy area.

Of course, this also depends on how many competitors you have nearby and what they are charging. Before you choose your price list, you should do some research and look at the websites of each one.

Target Audience

Your hair salon clients are equally as crucial as your location. Often, the two go together. Do some research online to find out what the average income is in your area. This will help you determine who you want to work with and how much they will pay.


One of the things you’ll have to do is find out which salon services your target customers want. Most of the time, you can charge a little bit more for these. Check out what’s popular on social media and look closely at your competitors’ charges. (although this is industry best practice at Sitehouse Digital Marketing, we frown upon this one) This will help you make your own list of prices.

Prices of other companies

When it comes to the competition, you’ll want to know their salon prices and what kind of customers they get. This information is usually on their website, which makes it easier for you to make a professional decision about price.


Pricing on pink background 109

You’ll want to set your prices low enough to be competitive, unless you have a well-known brand and can trade on its prestige and good name.

It is very important to not undercharge without good reason. If the price of a haircut or color appointment is too low, for example, customers might come to expect this all the time, which would make it hard to raise prices in the future or suggest that the services aren’t very good.

What should you think about when making a price list for your salon?

What to think about when making your salon’s price list.

Pick a pricing strategy for a salon.

Your long-term goals and your salon’s position in the market will have a big impact on how you set prices for your salon as a whole and on any promotions or discounts you decide to offer your customers.

This is a strategy that salon owners often use or change to keep up with or increase demand for different services or add-ons. One of the best ways to be successful is to know when to offer discounts and when to take charge and raise prices to make more money.

Here is an overview of the different pricing strategies used in the beauty industry, along with some tips to help you decide what will work best for your own salon business:

Pricing Penetration

This is something that hair salon owners often do to get more customers. This could be the way to go if you’re new to the area or the business. You start by asking people to pay less, and then later you raise the price.

This can help book appointments for your stylists and get customers in the door, but it’s not always the best way to do things. When customers are used to paying a certain amount for a haircut or color, it can be hard to raise prices in the future.

You’ll also need to keep your salon business’s image under control. Undercharging your customers could change how people think about the quality of your services or bring in the wrong kind of people.


The word Insight appearing behind torn orange paper.

Pricing based on what people are willing to pay

This strategy takes into account what your customers want and charges them accordingly. You’ll need to find out what each potential client values and how much they’re willing to pay for a service.

For this to work, you really need to know who your customers are. You’ll have to know what they want, what they tend to avoid, and which services they value most. Then you can make a plan for each of these things.

This usually works well for salon owners who have been in the business for a long time and talk to their customers often.

Skimming the Price

This is one way to make your pricing plan easier. You can do this by charging more for new or exclusive services at first, and then lowering these prices over time.

One way to do this would be to charge more at first for a new hair extensions technique or service, so you can make the most money while it’s popular, and then lower the price after the novelty wears off.

This method works well when you want to attract the kind of client who can pay more per service. Once you have them, you can then attract others who are interested because of them.

Premium Pricing/Niche Pricing

Does your salon have a name that people know? Are your hairdressers well-known and/or experienced? If you answered yes, prestige pricing could work for your business.

Customers will often pay more per service if they think your salon is better in some way. This is also called “image pricing,” and it takes advantage of how valuable people think your salon’s brand is. It’s a good plan if you’re already different from the rest.

Economy Pricing

If done carefully, this can be very successful. Your business and services will stand out from the competition if you use an economy pricing strategy. Look at what’s available in your area already.

Even though you should still be careful not to undercharge and keep an eye on the average prices in your area, you can target clients with lower or fixed incomes, such as students, young families, or senior citizens. This lets you appeal to people who care about price.

Figure out how your salon will charge.

Your strategy and any discounts your business decides to offer will affect how your price list is set up. Your pricing strategy will be based on your industry strategy and the services you offer.

Here are some of the most common methods, as well as tips on how they work:

Flat-rate prices

This is the simplest option, and it means charging one price per service, no matter how long it takes, what products are used, how many stylists are involved, etc. This makes it easy for stylists and clients to figure out how much each service will cost, but there is no room for flexibility.

In this case, a hair salon would charge the same price for all coloring services, no matter what color the client wanted or how long their hair was. Most of the time, this is done by either very expensive or very cheap businesses.


get 5 Sitehouse Digital Marketing |Salon & Spa Website Design 2023

Price Levels

This strategy gives customers a basic price for a hair salon service and then lets them add more items from a list, which gradually raises the price. This formula gives customers what they want—transparency—and the chance to make money when they spend more.

For example, a client who books a haircut would pay one price, but the price would go up if the stylist also did a wash. If they want a haircut, a wash, a hair treatment, and a scalp massage, the cost of the service goes up with each one.

You can also use this to book appointments with more experienced or well-known stylists by charging a higher price for them and a standard price for the rest of the team.

Variable Pricing

This is only recommended for complicated or multi-step color treatments or services that are hard to break down on your basic menu.

When figuring out how much something will cost, telling your clients to “call us for more information on pricing” is helpful. For more common hair salon appointments, however, you’ll still need to set clear and easy prices for clients to understand.

Price Levels and Changes

This is a mix of the last two. Clients can choose from a fixed-price menu and talk to you about the price of more complicated services or procedures.

This can work well in salons that focus on more complicated services, like adding extensions or coloring hair in more than one step.

Razor-Blade Pricing

Some salon owners decide to offer a discount on the first service and then make money by selling more expensive services on top of that. You could list a low price for a core service, like a haircut, and then encourage your staff to sell extras, like a conditioning treatment or a blowout, for more money.

This can be a good way to get each stylist to work harder and give more services per visit.

How do salon prices get worked out?

“How much should I charge for hair services?” is a common question. We’ll have to find out how much each service costs the salon to find the answer.

Start by dividing the price of each service by how long it takes. For example, if a coloring job costs $120 and takes two hours, 120 divided by 120 minutes is $1 per minute. This is what you’ll need to do for every price on your menu. You can figure out everything else once you know these numbers.

In the end, each of your prices will cover all of your costs, including the salaries of your team members and the costs of any products you use. Let’s look at this more:

What is the monthly cost to run your salon?.

This is your monthly budget, and it includes all of your costs for the year. List the money you spend on things like rent, marketing, taxes, utilities, cleaning, supplies, insurance, etc.

The cost of running a salon is the rent, supplies, marketing, taxes, utilities, cleaning, and insurance divided by 12.

Here’s an example of what I mean:

A salon with an annual rent of $40,000, costs of $10,000 for supplies, $4,000 for marketing, $10,000 for utilities, $4,000 for cleaning, and $1,000 for insurance would cost $72,000 to run, or $6,000 per month.


get 7 Sitehouse Digital Marketing |Salon & Spa Website Design 2023

Now, how do you include all of these costs in a single haircut? With practice and time.

Find out how many hours you worked each month.

The next step is to determine how many hours your salon is open per month and multiply that number by the available working spaces (chairs).

A salon open 10 hours a day, Monday through Saturday, and with seven chairs would have a total monthly working time of (10 hours x 24 days a month) x 7 chairs = 1,680.

Calculate Operating Cost Per Minute

Now that you know how much it costs to run your business per year, divide that number by 12 months, then divide that number again by the total number of hours you work each month, and divide this number by 60. This will tell you how much it costs to run per minute.

This is the basic formula:

Cost per minute to run = Cost per year divided by 12 / total working time per month divided by 60

Here’s an illustration:

Running Cost Per Year ($72,800)/12 = $1,680/60 = $0.06 Remember that running a business costs money. This is a way to figure out how much money you and your team need to provide services.

Add Variable Expenses

You can just add up the amount of each product you use. You’ll need to figure out how much each staff level makes (trainees, experienced stylists, etc.).

To do this, take the salary of each employee, divide it by the number of hours they work each month, and then divide that number by 60. This is how much they cost each minute. So, here’s how you could figure it out if a stylist makes $2,250 a month and works 40 hours a week:

Staff member’s salary ($2,250) divided by the number of hours they work per month (160) divided by 60 = cost of staff per minute of $0.23.

Calculate Overall Service Cost

To find this number, you’ll need to figure out how much it costs to run your business per minute and how much it costs to pay your staff per minute. Then, you’ll need to multiply these costs by the number of minutes your service lasts and add the cost of the products.

This is the basic formula:

Service Cost = (Run Cost per Minute + Staff Cost per Minute) x Service Time + Products Used

Let’s break it down using the numbers from our previous calculations and assuming that the hair color and other supplies cost a total of $25 and the job took two hours:

Service Cost = (Running Cost Per Minute ($0.06) + Staff Cost Per Minute ($0.23)) x Service Time (120 minutes) + Products Used ($25) = ($59.80)

Add Your Margin

You’ll need to make money now. When you think about it, this is why undercharging can be so bad. Your pricing strategy comes into play here.

Now it’s time to add the profit margin you’ve chosen to get the final price for your service.

The average profit margin for a salon is between 2% and 17%

This is how it works:

Service Price = Cost of Service times (1 + Margin)

Salon Cost Estimator

Salon software can help you figure out how much to charge for your services. The salon software has a calculator built in to help you figure everything out. This will save you a lot of time and money that you could have spent on other things.



Retail Goods

How do salon prices get worked out?

How Do Salon Prices Get Figured Out?

How to Price Retail Salon?

Most of the time, manufacturers set the prices for their products, but they will usually give you a range to work within. Check the product’s website to see if they have any suggestions for retailers.

Delivery and storage have a cost, so be sure to account for them. Your salon’s retail margin will usually be between 50% and 100%, depending on the products you sell and the customers you want to reach.

Here are some different ways to deal with each price point:

Suggested Retail Price from the Maker (MSRP)

Manufacturers who want the prices of their products to be the same in all salons will do this. Usually, stores will sell you the items for about half of this price, letting you make a profit.

Bundle Pricing

This is when you sell a bunch of things for one price. Shampoo, conditioner, and hairstyling products are a common type of bundle. This lets stores make more than one sale and profit from the number of items they sell.

This is also convenient for customers, but it can make it hard to sell these items individually at a higher price in the future.

Pricing that loses money

Quite a few stores do this. Customers are drawn in by a low-priced item they want, and then they are persuaded to buy more things while they are shopping.

Different prices

This is when you look at the average prices of your competitors and then set your own prices lower on purpose to make more sales. This usually works, but if you want to change things later, it makes it harder to raise prices.

Price for prestige

This is the opposite, and it means charging a lot for products that people think are premium or of higher quality. This strategy usually works best in high-end or popular salons.

How to set prices in a salon?

How Do You Price a Salon?

Ideas for how to price a salon and what not to do

  1. Don’t make it hard.

If you give customers too many services, add-ons, and custom options, they might get confused and be less likely to choose. Your staff will also have to work harder because of this. Use simple words and language that is easy to understand.

  1. Don’t get too excited about sales.

Only give discounts when it makes sense (such as on products about to expire, or for trainee services, etc.). Even though customers love saving money, you don’t want to lose money or have your services become less valuable.

  1. Don’t charge too little.

Don’t give in to the urge to lower your prices as soon as you see trouble coming. Every salon has its ups and downs, which you can read about on any business website. Always keep in mind what your services are really worth.

  1. Use pricing from psychology.

Even though it sounds silly, people are happier when they pay $99 instead of $100 for something. It seems like less money. Use whole numbers instead of decimal places, which make prices longer.

  1. When pricing high-end services, think about how much education costs.

For services like weaves and hair extensions, your staff needs to be trained in specific ways. Make sure to add these to your annual costs when you do the math.

  1. Tell your clients about price changes

Remember to be honest and tell clients why these changes are happening. Teach your team how to also talk to them. (prices should increase 2-10% yearly)


Darrin ui website of hairsalon on mobile tablet and desktop mon f7b0a7ec 5cb8 4e20 9386 4830668d1d4f Sitehouse Digital Marketing |Salon & Spa Website Design 2023

What Should Be on Your Menu of Services?

When you decide “how to price hair services,” you will also have to decide what these services are.

Your salon’s menu should include services like haircuts for men, women, and children (unless you decide to specialize), as well as coloring, styling, conditioning treatments, texture services, extensions, and any other unique services you offer.

Don’t forget to also put all of these on the website for your salon.

Setting your salon prices might seem hard at first, but it’s the best way to get a handle on your small business and the best way to make money.

Keep in mind that information is power. Once you have a plan for your business and know exactly what you need to do to make money, running your salon successfully every day will be much easier.

Using these tips and ideas, you can set prices for your salon that work for you and help your business grow.

Are you in the tri-state area struggling to get your salon online? Don’t wait any longer; contact us today and we can help you get your website and online booking set up. Don’t miss out on this opportunity to connect with potential customers in the New York, New Jersey, and Pennsylvania region – schedule a call now here!

Get our free salon marketing guide filled with everything you need to take your salon to the next level.


You might also enjoy


Free e-Book !

Market your salon like a pro!