What’s Next? Beauty Industry Trends Point to Blooming Booth Rental Market

Though not everyone in the industry is a fan, there’s no question that one of the current trends in the professional beauty industry is the continued growth of booth rental model business.

In fact, a Professional Consultants and Resources industry study suggests that nearly 50% of all U.S. salons will offer some form of booth rental model by the year 2015.

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And it’s not just about a growing number of booth rental models or opportunities; it’s about growth in the numbers of beauty professionals themselves:

• The Beauty Salon industry summary by IBISWorld notes that beauty industry employment will grow steadily through 2017 at a nearly 4% annual rate.
• Overall employment of barbers, hairdressers, cosmetologists, and shampooers is expected to grow 14% between 2010 and 2020. (Bureau of Labor Statistics)
• The US Bureau of Labor Statistics also lists skincare specialists among the fastest growing professions. From 2011-2012 the number of skincare specialists grew nearly 40%.

The Professional Consultants and Resources article notes that this trend will most likely lead to ‘hybrid’ new salon booth rental models “that combine the best client- and stylist-centric practices” (from other booth rental and more traditional independent and chain salon models).

6 Ways the Growing Booth Rental Market Might Change the Beauty Industry

• Bolstering the Educational Foundation

Cosmetology schools may bolster both the requirements for graduation and non-technical education offered to students. In addition, there are a number of places where salon professional organizations are lobbying for strengthening of states licensing and educational requirements for cosmetologists. For more information about potential changes to licensing in your state, check out probeauty.org’s list of state-by-state captains.

Bolstering graduation requirements could result in longer programs but may also entail a more formal apprenticeship or internship requirement in order to ensure stylists are prepared to run their own salon business.

Likewise, increasing education offered in non-technical subjects such as bookkeeping, small business payroll and tax preparation, marketing and other areas of salon management and operations could better prepare a graduate for running their own business right out of the gate.

• Development of New Software, Apps and Technology

Regardless of the business model, salons and stylists can benefit as developers bring new software to the marketplace geared specifically for the industry and their particular business type. For instance, the proliferation of booth renters may call for an all-in-one business software suite which facilitates online scheduling, bookkeeping, payment processing, marketing, payroll, taxes and even online sales.

• Suites of Specialists Sharing Resources

As salon suites gain traction in the marketplace, look for stylists to find ways to partner together as independent salons in order to spend more time pursuing their individual areas of passion as stylists and cosmetologists. It is not difficult to envision a grouping of beauty professionals who share retail space and sales, and even share clients for different services.

The advantage for the client in this scenario is being able to tap those who have mastered various styling, cutting, coloring or other techniques and have the ‘best’ of each; although it may present stylists with challenges in the area of branding and client loyalty.

• Opportunities for Traveling Continuing Education, Mentoring, Consulting and Business Services

Given a proliferation of independent salon owners in a given geographic area, opportunity arises for senior stylists and business consultants to rent their expertise, training and services by the hour (half day, day, etc.) Again, this is another area where salon suite groupings may also provide for shared resources.

• Salon Retail will Morph

The burgeoning salon booth rental market is not the only factor that will change the face of salon professional retail. For instance, the recent introduction of LoxaBeauty.com from industry giant BSG already promises to change the face of salon retail in a major way in the coming years.

But this is nothing new; discussion about retail of salon exclusive or salon professional products and salon professional product diversion have been hot topics for years.

While some believe that marketplace changes will lead salons out of the retail game, it is probably more likely that salon retail strategy should itself evolve into new forms. Clients will still need stylists to prescribe the most appropriate products for home use. Clients will still expect to be able to purchase retail from stylists as well as cosmetic gifts, hair styling tools, accessories, travel sizes of their favorite products, and other items from the salon, including the booth rental salon.

Furthermore, the evolution of salon retail (or booth renter retail) will likely be – and should be – unique to their given client base, geographic area, and other separating demographics. At its best, salon retail should have the ability to attract new clients and bring customers in specifically for retail items unique to a given salon or stylist – beyond coming in for an appointment.

• Evolution of Salon Distributors and Distributor Sales Consultant Roles

Most regional salon distributor sales consultants have long been much more than “sales people.” Providing expertise, ideas and information about more than salon products, the distributor sales consultant has also been a conduit of industry intel, trend forecasting, business consultation, marketing ideas, event partnerships and more.

Look for the distributor sales consultant to continue to evolve as a true business consultant to booth renters as well as independent and chain salons, including increasing skill sets that enable them to provide in-salon skill and product training plus offer expertise on business topics such as event marketing, email marketing, web site optimization, local search optimization and more.

Likewise, distributors themselves may need to be prepared to offer smaller-size intros to booth renters or develop shared intros for booth renters, even building pools of booth renters who can partner together to pay for intro packages and share retailing ideas.

Distributors that offer education may also offer reduced or shared-education rates to booth renters and independents such as salon suite business owners. In addition to on-going skill and product education, distributors can also expand education by offering classes in small business accounting, tax prep, payroll, marketing and other topics that independent business owners need to master.

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Elizabeth Kraus is the author of 12 Months of Marketing for Salon and Spa and the 2014 Salon and Spa Marketing Calendar: By the Numbers, available on amazon.com.