Where you work is one of the most important decisions a hairdresser will face for reasons that are personal, professional, aesthetic and financial. We took this question to Hairstory CEO, Eli Halliwell, who always manages to take both the wide-angle and the long-term view. Here is his advice for the newly-minted hairdressing entrepreneur.
Many hairdressers value two things above all else: Community and independence. They want both security and the ability to earn money like an entrepreneur. That is why they choose to “go independent.” The most successful among them either negotiate flat rental rates with salon owners or go out on their own – in both cases keeping 100% of the service revenue. In 2007, 80% of American hairdressers were employees at salons. In 2018, that metric is below 50% and falling fast. That’s a massive and swift transformation for any industry, and it has turned the hair business on its head. Based on the latest data I’ve seen, there are about 350,000 hairdressers in the US who work for themselves.
Hairdressers may rent a chair, rent a suite or a studio, work from home, or work on set. The common thread is they don’t get a W-2 from a salon owner who pays them commissions or from a big corporation that pays them hourly. What does it mean to work for yourself?
• It means you are responsible for filling your own schedule.
• It means you are responsible for keeping your own schedule.
• It means you are your own marketer.
• It means you are your own customer service.
• It means you are your own educator.
• It means you are your own critic and quality controller.
• It means you place your own orders and pay your own bills.
• It means you are your own CEO, CFO, CMO and CTO
• And you’re also the janitor.
Online trumps on-the-street
I think the concept of place for hairdressers, in general, has changed so massively in the past decade, and it is likely going to continue to evolve significantly for years to come.
In the past, hairdressers worked in salons and the owners were responsible for driving traffic with techniques from advertising to word-of-mouth to loyalty programs. But by far the most important tool for driving client traffic was the choice in real estate. Salons were considered retail establishments, and just like restaurants and stores, salon owners relied on their location and the look/feel of their build-out to attract new clients. And the better the salon owner was at attracting new clients, the more power they had in their relationship with their employee hairdressers.
Today, the importance of location is rapidly changing as it relates to hairdressers, and it is massively different for a self-employed hairdresser. As more and more consumers are turning to social media and online reviews to pick a hairdresser, they are less likely to simply walk into a salon off the street. They want a referral, a recommendation, a review, a crowd-sourced indication of what to expect. Searches on Google for “salon near me” have grown over fifteen-fold in the past five years, and the search results include independent hairdressers who are working on their own. And they highlight reviews. People aren’t wandering the streets; they are looking online.
And for independent hairdressers, walk-in customers are rare anyway. Hairdressers can only make the leap to independence if they have a client base to start with to cover their expenses. Because the focus is inherently on repeat customers over new, independence doesn’t have the same requirements of place and affords greater freedom to choose.
How to choose a space?
The most important consideration in choosing a space is the convenience of location for clients. You need to think about their travel needs (the less the better). The second most important consideration is you: Where do you like to work? What kind of environment helps you thrive? Do you want to be alone, or part of a bustling salon? Or do you want to be alone within a bustling salon? Hairdressers today have so many options available, and there are pros and cons to all of them.
The easiest transition from working as an employee is to rent a chair in a booth salon with a similar environment and energy. The pros may be having some basic necessities addressed on your behalf – cleaning, laundry, breakroom, reception, payment processing. Tradeoffs are that many rental salon owners still feel they have the prerogative to direct how you work such as setting rules around hours, requiring that transactions are completed at their front desk (possibly charging a transaction fee) and, most irksome to me, stipulating the products to sell. Many booth rental owners take a more hands-off approach in line with the true values of independence, but some want to shift the financial risk to their renters and still feel in control. To me, that’s not okay.
The next degree of independence is renting in a salon suite. Suites have become VERY popular in the past decade, for good reason: they have a very low cost of entry, relatively short (monthly) commitments and a sense of community without the obligation to be social. There are shared services (like cleaning); you have a fully independent space that you can decorate as you see fit; and while the financial commitment is technically longer (many salon suites will ask you to sign a year-long contract), leases are not often enforced. The downside is that suites can feel lonely. Yes, there are other people working nearby, but because most people work on their own schedules it is rare that a salon suite feels full of energy – more often than not, many are empty.
The last “traditional” option is to rent or own your own space, where you have control over every element of the experience – for yourself and your clients – and you don’t have to answer to anybody. In some ways, this is the fullest expression of independence, and the options are endless. Because street frontage is not necessary, you can rent a room on the high floor of an old warehouse, a loft apartment or a small house, and turn it into a live/work space. Or you can find a retail location that has struggled to find a tenant and create a more traditional space.
The tradeoffs, however, are obvious: First, you may feel alone without the energy of others around you. Second, if you’ve taken a larger space and need to fill it, you may need to recruit and manage others, turning you into a business owner. Third, you will likely have to do everything yourself – even cleaning the floors and buying toilet paper. The other important distinction is financial: Renting your own space means likely signing a real lease (with a longer term) and taking on the financial obligation. Of course, if you work out of your home, you don’t have the financial burden, but building out mini-salons still entails a financial burden that is important to acknowledge.
Hairdresser Jason Devastation runs his own business based at Hairstory Studio in New York City. He prefers the community of a salon and chose this space because of the “flexibility, creativity, the supportive environment and the potential for collaboration,” he says. But no matter which model you choose, he adds, “It comes down to brass tacks: Can you afford it, and will it be worth it? It requires some math and things creative people typically don’t love to do, but the research pays off.”
Salons of the future: The membership model
Each of the options described above has their tradeoffs, and none of them fully embraces the technological innovations of the past few years. We have many, super successful, entrepreneurial hairdressers in the Hairstory network who were asking: Is there another way? What will the salon of the future look like? What do I do if I want to be independent, but I don’t want to be alone?
These questions inspired us to develop an entirely new model for what a salon can be and how it can operate. And we put our idea to the test when we opened Hairstory Studio Dallas, in partnership with Beau Bollinger and his team. The core of the idea is this: create a space where like-minded hairdressers can work separately yet together, with all the energy of a salon yet all the freedom of independence – a creative collective. How to do this? Make everyone feel a sense of ownership. Make them feel they have a stake in the health of the culture and the functioning of the space. Make them feel like members.
When people join a club, they are buying into being part of something. New members apply and are either accepted or rejected based on their fit with the culture of the existing community. Accepted members pay an initiation fee or buy into the club in some way, and pay ongoing membership fees. They are not making a transitory decision; they are making a real commitment. Yes, there may be someone who owns the club, but once admitted, members have a sense of ownership. They care for the property, they feel comfortable there. They feel like they belong.
These core ideas have come to life at Hairstory Studio Dallas. Every hairdresser who works there pays an upfront membership fee to join. They pick their schedule and pay a full month in advance. They have their own keys to the space (or access via a Nest lock). Beau, the technical owner, ensures that everyone follows the rules (with full buy-in from every member), collects the fees, has his own name on the lease, and manages access. Otherwise, hairdresser members come and go as they please at all hours, and care for the space as if it were their own.
“Another benefit,” says Beau, “is that a talented team can create a whole lot more buzz than one individual. This affects the daily energy in the salon, clients’ excitement to refer, and the ability to get free press.” It is still early, but already we believe this could indeed be a wonderful model for the future.
Your space, your way.
The physical space where you spend your day is important. Whichever environment you choose, remember that you are making a statement about your personal brand. Working from home says something different from working in a formal salon or in an artist’s studio, so make sure your choice of space is aligned with your values, your personality – and your dreams.