Prices must reflect your costs

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Prices must reflect your costs

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If you’ve decided to take a closer look at how to build your price list, write down on a blank piece of paper the monthly costs in €€ for:

  • training and courses (if it is sporadic, calculate the country email list amount for the entire past year and divide by 12 months),
  • space or chair rental,
  • energy (water, electricity),
  • state contributions (social insurance and health insurance),
  • travel to work (gasoline, travel expenses),
  • materials (cosmetic products and accessories),
  • disinfectants,
  • refreshments for clients (coffee, tea),
  • magazines,
  • telephone and internet,
  • online advertising, or  production of gift vouchers or coupons
  • salon management applications,
  • reserve for possible reconstruction/repair.

Write down all the items from the list above that apply to you. Add the monthly costs in euros to them.  Finally, add up all the amounts and you will find out what your monthly costs are.

Calculating prices for your services

(numbers in examples are indicative)

Once you know what your monthly expenses are, add to them the amount that is your monthly salary for work.

  •  Example: monthly costs €1,500 + remuneration €1,000

Let’s assume that your monthly costs with remuneration for work are €2,500. A month has an average of 20 working days. If you also work on Saturdays, let’s say that it is 22 days. Let’s also assume that you are at work for 8 hours, but you actually work 6 hours (if we count lunch, break). So in total, in 22 working days you will work 132 hours. Simple math says that 2,500 : 132 = approx. €19 / per hour.

This means that if your “hourly rate” is €19, you can earn a monthly income to run the salon and also for your salary. Direct sales of products to the client (upsell) and online sales of services are also important .

If you have a male clientele, it is not a good idea to lower your hourly rate at the expense of other clients. With a men’s haircut, you can also win for one hour. The most ideal are clients who spend at least two hours with you. Therefore, try to promote more complex and longer procedures, which are also more expensive.
Keep in mind that every training or new course you pay for is counted towards your costs. Based on this, you can recalculate in detail how much is adequate to add to a given service.  Therefore, it is a good idea to go back to your price list and update it at least once a year.

How to talk to a client about price

The biggest shock you can give your new client is to only tell them the final amount at the very end. In that case, you always expose the new client to a surprise – pleasant or unpleasant.

It is very professional to discuss the price of a service with your new client at the beginning – before the procedure. You inform them of what it costs and how much. And you also use this opportunity to show that you understand your craft perfectly and that they are in good hands. People are willing to pay for quality. If you still don’t know how to behave when a client says you are charging too much, read they are also becoming part of a storied tradition this article .

With your regular customers, it’s a little different. They already know how much your services cost. You have built a good relationship with them and they trust you as a professional.  Therefore, offer them “UPSELL” – that is, selling additional products and procedures.  Your client needs to hear your recommendations and arguments why they need it. They trust you and are willing to pay more if you, as a professional, think it is necessary.

PRO TIP:  Keep your price list prominently displayed. For example, as a picture in a nice frame next to the mirror. This will keep the customer clearly informed and avoid surprises when paying.

 

How to talk about price increases

If you increase your prices, let your clients know. For example, if it is because you have completed training that will take your work to a higher level. Your client should know about this because the result on their hair, face, nails or body will be much better and more noticeable.

If you have purchased more expensive and higher quality materials, this will again be reflected in the result of your work. Explain to the client that these are more innovative materials that you have invested in so that your client has a better result from the procedure, but at the same time this will also affect the resulting price. If you are offering something revolutionary that no one else has or that has not yet arrived on the Slovak market, this is again a reason for a higher price.

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