How to price your salon services for profit
Pricing is one of the most stressful decisions for salon owners. Price too high and you scare away clients. Price too low and you're working for pennies. Let's find that sweet spot.
The pricing mindset shift
Before we talk numbers, let's address the psychology:
You're not just selling a haircut. You're selling:- An experience
- Expertise and training
- Quality products
- Time and attention
- How your client feels walking out
When you understand this, pricing becomes less about "what's the least I can charge" and more about "what's the value I provide."
The cost-plus pricing formula
Start with your costs and work up:
Step 1: Calculate your hourly cost
Add up your monthly expenses:
- Rent/booth rental
- Product costs
- Insurance
- Utilities
- Marketing
- Software/booking system
- Education/training
Divide by hours worked = hourly overhead cost
Example: $4,000/month expenses ÷ 160 hours = $25/hour overheadStep 2: Add your desired hourly wage
What do you want to earn per hour? Be realistic but don't undervalue yourself.
Entry-level stylist: $20-30/hour Experienced stylist: $35-50/hour Senior/specialist: $60-100+/hour
Step 3: Calculate per-service pricing
(Overhead cost + Your wage) × Service duration = Minimum price
Example:- ($25 + $40) × 1 hour = $65 minimum for a cut
- ($25 + $40) × 3 hours = $195 minimum for a colour
Then add product cost and profit margin (10-20%).
Market research matters
Your formula gives you a floor, but the market sets the ceiling. Research:
- What do competitors charge?
- What's the average in your area?
- What do premium salons charge?
Position yourself intentionally. If you're matching the cheapest salon, you're competing on price (a losing game). If you're 10% below the premium salons with great service, you're competing on value.
Pricing strategies that work
Tiered pricing by experience
Different stylists, different prices:
- Junior Stylist: $60 cut
- Stylist: $75 cut
- Senior Stylist: $90 cut
- Master Stylist: $110 cut
This gives clients options and rewards experienced staff.
Bundle services
Create packages that encourage upsells:
- "Colour & Cut Package" (5% less than à la carte)
- "Bridal Package" (trial + wedding day + touch-up kit)
- "Monthly Maintenance" (cut + treatment subscription)
Price by outcome, not just time
Balayage that takes 2 hours = same price as balayage that takes 3 hours.
Clients pay for the result, not your efficiency. As you get faster, your hourly earnings go up.
When to raise prices
You should raise prices when:
- Your costs increase
- You're booked solid 4+ weeks out
- You've gained new certifications/skills
- It's been more than 12 months
- You're underpriced vs. market
Common pricing mistakes
Mistake 1: Charging by time only Colour that takes 2 hours isn't twice as valuable as colour that takes 1 hour. Charge for complexity and outcome. Mistake 2: Matching cheap competitors You can't out-cheap the cheapest. Compete on quality, experience, and expertise instead. Mistake 3: Not reviewing annually Costs go up every year. If your prices don't, your profit goes down. Mistake 4: Discounting too often Constant discounts train clients to wait for sales. Keep discounts rare and strategic.The confidence factor
Here's the truth: clients can sense when you're not confident in your prices. If you apologize for your rates or immediately offer discounts, you're telling them you're not worth it.
State your prices clearly. Explain the value. Stand behind your work.
The clients who balk at fair prices weren't your ideal clients anyway.
Action steps
Final thought
Profitable pricing isn't greedy—it's sustainable. A salon that doesn't make money can't pay good stylists, buy quality products, or invest in client experience.
Price for profit so you can deliver excellence. Your clients will benefit, and so will your business.