Summer is knocking! It’s a time for renewal and growth in nature. Can you feel the difference?
For over a year, our lives and our businesses have been on hold. Survival was the only instinct. The pandemic has put so many small businesses on the line, even more so for our industry with hair, beauty and personal care closed through lockdowns.
But as lockdowns ease and we move towards a life of total normality (slowly but steadily) what’s the next step that you plan to take in your business? Will you just mark time or go for business growth?
Of course, this is a new normal. There’s still caution in the air, but it can also be a great time to look even further ahead and plan your business expansion strategy.
If that’s something on your mind for a while, then this post is for you! We’re going to share top business expansion strategy tips for hair and beauty businesses in 2021.
So let’s get started.
While expanding your business may seem like a great idea, it does require some ground-work. That’s why it’s essential for you to address some key questions before you begin things:
This is an important step. Answering these questions will help you fine tune the next steps.
Maybe you need to think about different opening hours so you can serve more clients in the space. New opening times might suit some clients better. How about extra weekend or evening openings for people at work maybe? Early morning slots for busy commuters if you’re close to a railroad station?
But, if that’s not a practical solution, it could mean a search for new premises. More of that later. For now, let’s concentrate on those clients because they’re the real key to business expansion.
First off, it’s your existing clients who really matter. They’re your base and your foundation for business growth. You want them back on board and coming in regularly again. A busy salon has a great buzz about it — for your clients as well as your staff. And, that’s the kind of atmosphere that keeps people coming back—stats prove it.
If you’re just reopening, how do you get those clients back? Some, as we said earlier, just can’t wait. But others may be cautious. First thing, let your clients know you’re open again and tell them why it’s safe to come back.
This is when social media really counts — spreading the word matters. Announce the big opening, show the photos of the busy scene and encourage your clients to share their ‘great to be back’ moments.
When clients come back for their first visit, make sure they want to come back for more. Offer them discounts for regular advance bookings or add a free gift when they make their next booking – a personal care product that you know they like.
Ask your regular clients about the kind of service they want. How could you make their future visits more special or convenient? Maybe, there are services you don’t currently offer that they would like. Why guess when you can ask the question.
It’s all about strengthening relationships. When you’ve got that continuity, you’ve got a firm foundation for business expansion.
Another essential move in your business expansion strategy is a focus on new services and new clients. If you get the new services right, it could mean more revenue from your existing clients too.
Take a close look at your competitors. What do they offer that you don’t? How successful do you think they are because of the other services? When you’ve created a wish list, how practical would it be to introduce those services? Is there something that you can add to your existing salon or spa menu?
It could mean big investment in new equipment and stock. You might need to hire staff with different skills and experience. Either way, it’s going to cost, so you need to be certain that the payback to your business will be worth the investment.
Making those calculations will be important when it comes to finding the funding for expansion, so make sure you give it careful consideration. And, take soundings from other people.
You know people in the trade and so do your staff. How do they feel about the new services you’re thinking about? When you talk to your staff, you might just uncover hidden talents, so you don’t have to think about new recruits.
Along with plans for new services, look at the kinds of new clients you could attract. That starts with a review of your existing client base.
What’s the age profile? Could you attract a younger or older age group with the new services you’re considering? Where do your existing clients live? Do they travel outside their neighborhood because you offer a great service, or do the majority live locally?
If you find that a lot of your clients are not local, that’s a big plus for your business and shows that you can expand based on your reputation, not your location.
When you’re looking at competitors and their clients, are they offering higher value services to attract a different kind of client who is willing to pay more for a premium service? That could influence the way you market your business in the future.
It doesn’t matter whether new clients or existing clients are the focus of your business expansion strategy, good old fashioned client service is the key to success.
It’s easy to ignore client service when you’re concentrating on business growth, but you do that at your peril. Social media will take revenge if you let your clients down.
Don’t ignore warning signs like staff rushing clients so they can fit more in or making people wait for appointments because you’ve tried to book in too many people. It’s a fine balancing act to get the numbers right when you’re growing.
And, take a close look at the things that matter to your clients. How easy is it to book appointments, for example? When people phone in and you don’t have a dedicated receptionist, do you keep them hanging on the line because your staff is busy dealing with existing clients?
Could you introduce an alternative booking system? An online appointment scheduling software like the one we offer at Booksy, or email bookings to cut out phone frustration? Can you accommodate walk-in clients at quieter times of the day? Offering that kind of convenience could turn walk-ins into regular clients.
Those are some of the ways you can grow your business in your existing premises. But, if space proves to be a barrier to expansion, it could be time to look for a new site. When you do, make sure it offers you a location that’s convenient for clients and the space to fit out your salon for the next phase.
Make sure the new site has parking space on site or nearby. Is it close to a bus route that some of your clients might need? Is it in the same neighborhood where most of your existing clients live? You don’t want to leave them behind in a rush for expansion.
What kind of location is it? If you’re currently based in a mainly residential area with just a few local stores, you could benefit from moving to a busier retail site where you could attract more walk-in clients or clients who can make it more of a destination.
From a practical perspective, what would the new place offer you – more space, better facilities, smarter appearance, a prime location and room to grow again beyond your immediate expansion plans?
If it ticks all those boxes, you could be making a smart move.
Okay, you’ve got your business expansion strategy in place and a clear view of how you’re going to get there. The next question is, how will you fund the next stage?
It’s unlikely that you’ve got investment funds of your own after a tough trading year like no other, so you’ll be looking for a loan or a grant to get your plans into action. Grants are available through the US Small Business Administration, but these are mainly focused on business recovery rather than growth.
Your aim is to secure a loan or grant for expansion, and to apply for that, you’ll need to know the value of your business.
There’s no standard or magic formula for calculating business value, but lenders will take many factors into account. Your aim is to present the most positive picture of your business to lenders by focusing on both tangible and intangible factors.
Lenders want to know you have a sound financial business, although it’s understandably difficult to rely on recent financial performance because of the pandemic restrictions. Instead, you’ll need to present results and trends from previous financial years.
Ideally, your profile should demonstrate good cash flow, strong credit control and consistent income growth and profitability.
Lenders need to understand your business so they can assess their risk and their potential return. So that’s where the planning and analysis you put into your business expansion strategy will help you present a positive picture.
Describe your client base. What’s the age profile and the proportion of regular clients compared to occasional clients? Explain the buying patterns in your type of business. How frequently do clients use your services and what’s the average spend?
You can add more value to your pitch by describing your reputation and the strength of your brand. client testimonials are great for reinforcing that message. Make sure you highlight the unique features of your business – any specialist services, your expert staff, your advanced equipment – and show how they contribute to the value of the business.
Finally, explain the reason for your loan request. Show how you will use the funds to expand your business with a timeline for return on investment.
By describing those factors, you create a comprehensive positive picture that gives lenders the information they need to make a realistic assessment of your business.
With the funds in place, you’re set to go. Careful planning and a focus on serving your clients the best you can will put you in a strong position to expand your business and take full advantage of the economic upturn that looks likely to follow the slowdown of the virus.
Your clients need you more than ever, so make sure you grow in the way they want. At Booksy, whether you want more clients, more time, or less overall distractions, we’re here to make your business experience better for you, and for your clients.
Try Booksy for free – we offer online, clear communication and a memorable service experience. What’s not to love?
Editor’s Note: This post is contributed by Mateo Fabregas who’s an aspiring writer, with a keen interest in small business matters, law and employment law, and real estate. When he’s not on the keyboard he’s in the kitchen of one of his three restaurants.
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