October 18, 2021

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A Ground-Breaking Study Shows the Resilient Beauty Industry

8 min read

TORRANCE, Calif., July 09, 2021 (GLOBE NEWSWIRE) — With U.S. salon and spa doors closed during the pandemic from six weeks to eight months depending on their state and county orders, and social distancing guidelines limiting the number of guests that hair stylists, barbers, and nail technicians could service upon reopening, the COVID-19 pandemic struck a particularly devastating blow to the professional beauty industry.

To ascertain how the industry is recovering from the pandemic, as well as how the pandemic impacted the business and personal lives of beauty professionals who work in the industry, Bobit Beauty Health and Wellness conducted the 2021 State of the Industry Research Study, surveying 4,500 beauty professionals over three weeks in May 2021. The study, which was underwritten by Beauty Quest Group, SalonCentric, Ulta Beauty and Redken 5th Avenue NYC, revealed the pandemic struck a challenging financial blow to both beauty professionals and salon businesses overall, professionals surveyed report they are slowly recovering and are optimistic about their own futures and the future of the industry overall.

Several key insights indicate positive movement in the beauty industry:

  • Most salon professionals are optimistic about the rebound in business.
  • Most salon owners were able to reopen their businesses after the mandated shutdown period; some with the help of financial assistance.
  • Adoption of touchless/contactless technology is widespread.
  • Many beauty professionals are beginning to see new clients in addition to their regular clients.

“The fabric of the professional beauty industry is comprised of independent service providers, small business owners, salon chains of varying sizes, distributors and manufacturers. It’s quite fragmented, and while an individual or owner may know where their own business is in the recovery process, it’s quite impossible for them to assess how they are doing versus the rest of the industry,” says Stacey Soble, director of brand content strategy for SALON TODAY. “The results of this study provide that critical context.”

Sales Impact

While the pandemic obviously caused beauty-based businesses to lose revenue while their doors were closed due to state and county mandates, the primary goal of the study was to measure how sales have recovered in 2021 compared to levels prior to the pandemic.

Salon and spa revenue is comprised of the sales of the services that stylists, barbers, colorists, estheticians and massage therapists perform, as well as revenue generated from the retail products they sell. In the salon environment, these service providers drive service revenue based on the number of clients they can see in a day and the price of the services the clients are purchasing.

For this reason, highly successful stylists work with assistants to double- and triple-book clients. After opening from the mandated closures, most salons were under strict social distancing standards, forcing them not only to restrict the number of clients that could be in the salon at one time, but also the number of staff members that could work any given day, so many salons temporarily banned the practice of double-booking clients.

In addition, salon revenues were impacted by the number of clients who hadn’t yet returned to the salon, the length of time between clients’ booked appointments, social distancing restrictions, and the number of staff members salons lost who didn’t return after the shutdown period.

  • Of the salons surveyed, 64% reported that service sales in the first quarter of 2021 were lower compared to service sales prior to enforced shutdown.
  • Salon professionals reported the biggest reasons for these sluggish sales are that not all clients have returned since they reopened (39%), the salons are limited to what they can produce because of continuing social distancing requirements (19%), and clients are stretching out the time in-between appointments.
  • In addition, 43% of salons reported a decrease in retail sales in the first quarter of 2021 compared to retail sales prior to the enforced shutdown period.
  • Despite the loss of sales, 65% of salon professionals considered their business on the road to recovery, while more than a fourth believed it was too early to tell.

Pandemic Impact

The study also asked both beauty professionals, such as stylists, barbers, colorists and estheticians how their professional careers fared during 2020, when many salons were closed.

“Licensed salon professionals, like hair stylists, barbers and nail technicians, receive many hours of training on sanitation,” says Anne Moratto, director of brand content strategy, MODERN SALON and NAILS. “They are experts in how to create a clean, safe space for themselves and their clients. As businesses reopen and personal care services resume, these professionals are also perfectly positioned to rebound. They are optimistic, even while navigating the uncertainties of an on-going pandemic.”

  • 38% said they would have struggled financially if they didn’t have unemployment and 28% said they did struggle financially despite any assistance they may have received.
  • Owners of the beauty establishments faced their own challenges—30% say they still own their salon, but would have been forced to close if they hadn’t received financial assistance; 25% said it was a tough year, but they would have survived even without the assistance; 18% said it was a tough year, but their business is stronger than ever; and 8% shared they had to close their doors permanently.
  • According to the study, the pandemic also had a significant impact on pricing. Because salons had to incorporate new procedures and provide personal protective equipment to both staff and guests; 42% say they have needed to raise their prices and an additional 11% instituted an additional COVID-19 or environmental fee.
  • Hair color services are the number one driver of revenue for most beauty businesses. The study asked beauty professionals to estimate the number of their clients who turned to coloring their hair at home during the pandemic—23% believe between 1-25% of clients took matters into their own hands, while 17% said 26-70% colored their own hair, and another 16% believed 51-74% hit the box color.

Staff Recruitment & Recruitment

Now that salons and spas have been able to open across the country, many are reporting that it has become challenging to meet the demand for appointments because they either have had staff members not return to their former positions or their capacity is limited because of social distancing requirements.

As the professional beauty industry was facing a stylist shortage even before the pandemic, the topic of staff recruitment and retention was a special focus of the study.

  • For locations that are still open, the study asked owner what percentage of the original staff who were working for them before the shutdown were still working for them today. A positive 43% say all their original team continues to work for them; while 10% of respondents said between 81-99% still work for them; and an eye-opening 15% thought less than 50% of their original team returned.
  • Slightly more than a third of salons (36%) said they need to recruit additional team members.

Future Business Impacts

As the professional beauty industry struggled to embrace the changes brought on by the pandemic, they adopted new trends and behaviors that will continue to impact the industry for the foreseeable future.

For example, aided by advances that salon management software programs quickly brought to market, a number of salons embraced new contactless procedures for booking clients, selling products and processing payments. In addition, the pandemic is impacting the way beauty professionals believe they will consume education in the future, as well as how they attracting new clients through their doors.

  • The study asked salons what touchless/contactless technology features they have embraced due to the pandemic—39% started using touchless checkouts; 28% adopted curbside check-ins; 18% embraced ecommerce/touchless retail; 16% implemented virtual consultations; and 15% added digital forms and liability waivers.
  • 36% of beauty professionals reported seeing significantly more or slightly more new clients now than they did before the shutdown, for a number of reasons—65% believe their current clientele are recommending them to their friends and family; 64% believe they are picking up new clients because they feel safe in their environments because of their cleanliness practices; and 43% say they are picking up new clients from salons that have closed in their area.

Mood and Outlook

The financial losses of last year, the fear of working so closely with clients during a pandemic, and listening to clients talk of their fears all day long has taken a toll on the mental wellbeing of beauty professionals.

While salons can maintain a social distance between clients, it’s impossible for beauty professionals to perform their services without touching their clients. In addition, most salons adopted rigorous cleaning procedures and required guests and clients to wear masks, gloves and/or shields. All of this places a greater burden on the staff who work with clients all day long.

At the same time, the beauty industry is resilient, and the study shows the workforce feel positive about their current position and the health of their businesses.

  • When asked about their biggest challenges between April 2020 and 2021, the biggest concerns were paying the bills (49%); the fear of catching the COVID-19 virus (46%); and mental health struggles (45%).
  • 21% of respondents reported they consulted a mental health professional during the pandemic.
  • 27% reported a majority staff seemed happier in the first quarter of 2021 than in the last quarter of 2020, while 23% said a majority of their staff seemed the same.
  • When asked to rate their overall happiness with their current salon professional situation, 25% reported they are extremely happy; 30% reported they are very happy; and 24% reported they are somewhat happy.
  • When asked how satisfied they are with the amount of money they make in their current salon professional situation, 10% are extremely satisfied; 23% are very satisfied; and 34% are somewhat satisfied.

The results of the 2021 State of the Industry Study were presented to the industry during a webinar June 21, hosted by Anne Moratto and Stacey Soble. Industry visionaries Scott Missad, president and CEO of Beauty Quest Group; Bertrand Fontaine, president of SalonCentric; Nick Stenson, senior vice president of store and services operations for Ulta Beauty; and Candy Gebhart, general manager of Redken 5th Avenue NYC, joined the webinar offering their insights into the data, as well as their wisdom and advice. The complimentary webinar may be accessed on demand at https://event.webcasts.com/starthere.jsp?ei=1476876&tp_key=504bee3a19&sti=press

About Bobit Beauty Health and Wellness: Beauty Health and Wellness, which is located in Buffalo Grove, Illinois, is a division of Bobit Business Media, which is based in Torrance, California. The division includes the media brands MODERN SALON, SALON TODAY and NAILS.

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