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Counteract Economic Uncertainty
By: Victoria L. Rayner
Posted: June 6, 2008, from the January 2007 issue of Skin Inc. magazine.
During World War II, the American government ordered a 20% curtailment in cosmetic and nylon manufacturing to support the war effort. However, the beauty industry quickly counteracted these federally mandated sanctions that had the potential to cost them millions of dollars in lost revenues. Industry professionals very cleverly stepped up the promotion of lipstick, as well as leg makeup, and labeled their business-driving strategy a “wartime morale-booster.” Not only did these top cosmetic executives avert a financial catastrophe, they created a solution that served to rally support and filled women from coast-to-coast with an enormous sense of national pride.
Women who lived through this period, many of whom are now in their mid-80s or older, still maintain that drawing artificial nylon seams down the backs of their legs with grease lead cosmetic pencils in an attempt to replicate the appearance of nylon stocking seams was the least they felt they could do to show their support during wartime.
Although most people would rather not acknowledge it, history does have a way of repeating itself. What inevitable or unpredictable changes in the economy are in store for skin care professionals? If a sudden event were to occur and the result was a financial backlash that affected our livelihood, would today’s spa industry be as prepared to put another spin on it? Could it muster up the ingenuity to devise comparable solutions and perhaps even latch onto less obvious opportunities?
It is a well-accepted fact that the beauty business is more complicated today. Resourcefulness is essential to offset financial problems in an unstable economy. No one can dispute that unforeseen events can crop up without warning and diminish earnings. Most people are completely unprepared for lulls in the national financial system and have not calculated the possible cost of an abrupt interruption in fiscal flow to business. Monetary pressures, reduced work schedules and layoffs are an all-too common reality. It does not matter how successful a business is if the base of its operations suddenly is disturbed and business activities cannot be conducted as usual, or if clients begin to pull back on their spending.
When the economy slows down, its effects are felt in other ways, too. Oftentimes, it makes it harder to restock popular retail items, which decreases sales quotas or reduces overall profitability. Certain products become increasingly difficult to find. Without warning, suppliers—after an in-depth cost-benefit analysis—discontinue what they see as poor sellers.