After more than two years in business, I recently raised prices at my Princeton nail and skin studio, Grit + Polish, including the most visible, the price of a basic manicure will be $25, up from $20. I must admit I am nervous about it because many customers chose a nail salon based on the manicure price.
But I must do it, despite knowing that some local nail salons charge about half that amount for a basic manicure with polish. My hope is that customers in the Princeton area will be willing to pay more for three key things offered by Grit + Polish:
- high quality products;
- the cleanliness of the salon;
- fair compensation for nail technicians.
In fact, these are the pillars upon which I opened my business in late 2016. One year before, I had read a devastating exposé of the nail-salon industry in the New York Times that chronicled horrendous working and sanitation conditions of many low-priced salons. A new report on the nail industry in California has added statistics that are surprising to many people, although not me. It found that 61% of nail salon employees are paid below minimum wage, which is illegal of course; 89% are not paid overtime, also illegal.
After reading the 2015 Times article, I began a year-long process of researching the local industry. I visited most of my future competitors, and because I am bilingual, I was often able to talk confidentially with Latina technicians while on the job. Speaking Spanish in hushed tones, they confirmed for me that they were underpaid, had tips stolen, and were only allowed to provide pedicures, leaving the “higher status” manicures to the white or Asian workers in the same salons. This made me even more determined to do it the “right way” in the hope that customers would support this effort and commitment, particularly in a highly educated and progressive community like Princeton.
I also decided that I needed to provide hospital-grade sanitation equipment, and ventilation to minimize fumes that can harm clients and employees. And I committed to using only the highest quality products, principally from PCA and FarmHouse Fresh, a new brand offering natural, organic, and cruelty-free products.
What have I learned? Unfortunately, I can’t offer all that and to keep my prices at $20 per manicure, which is already on the high-end compared to many competitors. Other nail service prices need to go up as well. In the interest of transparency, I’d like to share with you sharing the costs of a basic manicure.
The biggest single item is labor. In keeping with my commitment to pay a living wage, my technicians are paid a significant base hourly rate plus a modest commission percentage. The total is about $20 per hour, or $10 per 30-minute manicure. In addition, I need to factor in downtime and payroll taxes, bringing the labor total to about $13 per manicure. I spend about $3 per manicure on supplies (acetone, oil, polish, lotions) and my overhead is about 28% of my revenue based on projections for 2019. As the table below indicates, I lose money at $20 and make a profit of just 8% on a manicure priced at $25.
|Cost Structure fir 30-minute manicure|
|Base + Commission||$10.00|
To be fair, there is room to improve on this as my business grows, reducing downtime and overhead—which includes not only rent but also utilities, equipment, and a receptionist/scheduler—as a percent of revenues. But I can’t imagine it would ever be possible to stay in business at $20 without abandoning the core principles of my business: Paying a fair wage, offering a healthy environment for my customers and employees, and using high-quality products.
The nail industry is booming, growing at twice the rate of the national economy. Demand is driven, of course, by a desire to have healthy and attractive nails. But I think an even bigger reason is our need for the human touch, which is why nail salons are immune to the trend toward automation that is impacting so many industries. The human connection is fundamental to what we do.
Which is why I think it is so important that the person on the other side of the table--your nail technician--is compensated fairly and provided with a safe work environment. We’re doing more than delivering a manicure. We’re taking care of each other.