With the price of goods and services quickly rising, there is a heightened focus on the short and long-term effects that inflation can uniquely have on the spa and aesthetics industry. However, inflation doesn’t have to result in a negative impact on your bottom line.
Below are my top recommended strategies to help spa professionals evaluate to what extent inflation is affecting their business, along with proven ways to help streamline operating costs and keep margins healthy during challenging economic times.
Related: 7 Tips for Enhanced Spa Success
5 Tips to Managing Inflation
1. Keep Your Emotions in Check. It is okay to feel stressed, but don’t let fear rule your decision process. Acknowledge your feelings and sit with them. Be prepared to move into action once you give yourself a few days to adjust to your business’ new normal. Do whatever it takes to help you center yourself so that you can make clear-headed, rational decisions.
2. Determine the Severity of Impact. If your business is already profitable and your costs have risen, you may be able to ride inflation out. The good news is that things that go up usually comes back down, and we may find that inflation reduces again over time. Sometimes when you don’t know what to do, the best choice to make is to do nothing.
3. Revisit Your Cost of Doing Business. It is smart to review your overhead quarterly. Request or download a report of your last three months of expenditures. Review each invoice and ask yourself whether these are necessary costs. If not, consider reducing or cutting them.
4. Evaluate Your Personnel. When you do a review of your costs, it makes sense to evaluate your team members as well. Ensure that the value they are bringing to your business is on par with their payment.
5. Review What You Are Paying Service Providers. It is wise to regularly review the value that third-party providers give to you. Ask yourself if you are able to reduce their scope or manage without them. Some providers will be willing to renegotiate with you to keep your business. Similar to managing internal team members, open lines of communication are key for managing external team members.
For further information on the topic, please download our free eBook, titled “Inflation: 12 Survival Strategies for Beauty Business Owners.”