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Coronavirus impact: Now pay more for haircuts, facials at salons post lockdown

Gone are the days when a customer would inadvertently walk into a salon to avail a service, as service by appointment would be the new norm

twitter-logoAjita Shashidhar | May 6, 2020 | Updated 18:29 IST
Coronavirus impact: Now pay more for haircuts, facials at salons post lockdown
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Apart from pictures and videos of delicious home-cooked food on social media, another trend that has picked up lately is people attempting to do their own haircuts, hair colours or facials. With salons closed, "Do It Yourself" or DIY seems to be the new buzzword of the beauty industry. According to a recent McKinsey report, DIY hair colouring, nail care and care in other beauty categories are finding new customers. In the US, sales of hair dye and hair clippers increased by 23 and 166 per cent, respectively in the first week of April versus a year ago. In the UK, nail polish sales are increasing by double digits every week.

Despite DIY becoming a trend, the salon industry is gearing up to welcome customers as soon the lockdown is lifted. From restarting operations with less than 50 per cent staff strength in order to maintain the required social distancing norms to giving their customers exclusive protective kits and also getting their staff to use a fresh kit for every customer they service, salon chains are doing everything possible to win the trust of consumers. Gone are the days when a customer would inadvertently walk into a salon to avail a service, as service by appointment would be the new norm. Most salon chains also plan to move to contactless billing, wherein they would encourage customers to pay online.

"My cost for each customer will go up by Rs 200, as we will give each customer a personalised kit, consisting of scissors and trimmers. We will treat both our customers and staff as COVID patients as we will make sure both of them are given the required protective gears and masks," says C.K. Kumaravel, Founder of the Chennai-headquartered salon chain, Naturals.

"We are going to tell our customers that we expect them to have the Aarogya Setu app, apart from the temperature checks that we will do before they enter the salon. We will also do temperature checks for our staff," adds Bhupesh Kinger, Director, Enrich Salons. The added safety measures would increase the operating cost of salons between 15 and 20 per cent, which would also translate into a 15-20 increase in cost of salon services.

Tough times

Consumers are unlikely to avail as many services as they used to do before the lockdown started. With safety and hygiene becoming a huge concern and priority, bulk of consumers may only avail basic services such as a haircut. Services such as threading, waxing and indulgence services such as spa and hair treatments that are done in closed doors may stop until coronavirus fear phases down. "We have reengineered the customer experience journey at all touch-points in the salon. Qualified medical experts have reviewed and enhanced the protocols for services like threading, waxing, manicures, pedicures and facials, to reduce the chances of transmission. Besides reducing direct person-to-person contact, the new protocols eliminate sharing of products and have detailed sanitisation protocols that advocate the use of protective gear and disposables at all times. The new service procedures and enhanced safety measures will ensure that both customers and salon staff are protected and have a safe service experience," points out an HUL spokesperson (HUL owns Lakme Salons).

Kumaravel says that cutting down of a host of services will hugely impact profitability. "80-90 per cent consumers will only ask for basic services such as haircuts, which are loss-making services. I make my money through services such as hair colouring, hair spa and facials, services such as hair extensions and bridal make-up are where I make a killing. The next one year will be a business of survival for us. We won't make profits."

Spoorthy Shetty, CEO, BBlunt, agrees that business will shrink post the lockdown. "It will take many months to even reach our past performance levels, so there will be a razor-sharp focus to reduce overheads. We may have to consider limiting the number of days and working hours to cut down utility costs, work on inventory rationalisation as we don't want money sitting on the shelf, we may want to review the compensation structure, align the salary with higher variable and lower fixed," she explains. "We will also speak to our landlords for more consideration, where a part of the rent can be fixed and some part can be on revenue sharing model. We will not make fresh marketing investments to acquire new clients, rather focus on our regular client base," she further adds.

In fact, Kumaravel of Naturals says that most of his franchisee partners will be unable to run the show unless the government comes to their rescue. "Even if the government gives back part of the GST money we have paid, we can at least pay salaries to our staff. Each of our franchise invests Rs 50 lakh per month, which covers salaries, product costs and laundry expenses. They have managed to pay March and April salaries, but beyond that, it looks difficult." Naturals runs 675 salons across the country, out of which Kumaravel owns just five of them.

Innovation

Necessity is the mother of invention and the salon industry is also trying to think differently in order to stay afloat. Enrich, says Kinger, is toying with the idea of video consultations. "We are creating videos on skincare and haircare and will start offering virtual video consultations. We will basically help our consumers to take care of their skin or hair with the materials they have at home. At a later stage we may sell beauty kits and follow it up with a virtual video consultation."

The salon products business is a relatively big one and lot of FMCG companies such as Loreal, Wella and Schwarzkopf have salon exclusive products. Kinger of Enrich says that his company has already started offering these products on its website and has even started delivering them to consumers' homes.

Will home salon services become a reality now? The industry stakeholders are apprehensive. "Health and safety of our employees are as important as the health and safety of our clients. Not all salons will look to shifting to home services as home is an uncontrolled environment and 80 per cent of the COVID cases are asymptomatic. Physical store is a more controlled environment where guidelines can be implemented and monitored. The omni-channel is now being discussed more than ever but we would take baby steps as of now," says Shetty of BBlunt.

"We believe that customers will have a safe service experience in the controlled salon environment with stringent hygiene measures and detailed checks in place. This is difficult to replicate in home services where the service providers are likely to go from one home to another. Hence, we will continue to focus on delivering services in the safe environment of Lakme Salons," adds the HUL spokesperson.

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