Running a laser hair removal clinic can be very lucrative. In fact, the hair removal business is already a multibillion-dollar industry. Through 2025, the global laser hair removal market is expected to have a 17% compound annual growth rate (CAGR), according to a MarketWatch report. The last thing you need are unnecessary expenses that eat into your hard-earned profits.As the owner of a laser hair removal salon, you certainly want to reap the rewards of your industry’s growth. After all, you’ve made a big investment:
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Clearly, running a laser hair removal clinic and waxing salon can cost you well into six figures upfront. And it cost you well over $10,000 per month to run (and potentially much, much more). That brings up the question: Have you looked at the credit card processing fees at your laser hair removal clinic? Do that, and ask yourself: Why do I have to pay these fees? Want to know a secret? You don’t.Here’s how you can reduce credit card fees and boost revenue for your laser hair removal salon:
What you’re paying in credit card processing fees may differ from other waxing salons and laser hair removal clinics. As the chart from ValuePenguin shows below, your payment processing rates could be as low as 1.43% or as much as 3.5%.
If you talked to other laser hair removal clinic operators, you’d probably discover a more complex situation. It’s not as simple as a set rate per transaction. For example, some merchant service providers (MSPs) may include complicated surcharges and multi-tiered plans. And what laser hair removal clinics actually pay in credit card processing fees could greatly exceed 3.5%—the highest fee rate that American Express charges. Why do MSPs do this?The honest answer is because they can. Many owners don’t have time to shop for lower fees. Moreover, the credit card processing industry lacks regulations, and MSPs know laser hair removal clinics have a busy schedule. They set high fees and rake in the money as long as they can without the clinic noticing. Don’t let this happen to you.Make the issue a priority at your laser hair removal business. Because credit card processing fees don’t just nip at your profits. They bite off a big chunk.
Only you can figure out the exact numbers here. To get a better idea, look at consumer research. You’ll see a significant portion of your revenue comes via credit card payments. First, the 2018 TSYS US Consumer Payment Study found credit card has been the preferred payment method for 26-35% of transactions since 2013:
Second, as data from Statista shows, the average value of a credit card transaction is quite high across all brands:
People swipe the credit card more for larger transactions. This makes sense, given the consumer protections credit cards offer. Even though debit cards account for a higher percentage of transactions (54% to 26%), credit card purchases account for nearly 53.5% of total card spending, versus 46.5% for debit (Barron’s research). Now, consider the average cost of treatments at your laser hair removal clinic.
As you know, most of your clients spend a good deal of money. Considering what the research says, a good portion of your clients undoubtedly pay with a credit card. If you offer discounts for multiple treatments, such as a 20% discount per waxing session if you buy 10 at once, then it’s even more likely a customer will use a credit card at your waxing clinic. And these will be some of your largest client bills.Knowing all this, it’s possible 60-70% of your laser hair removal clinic’s revenue comes from credit card transactions. This makes it all the more crucial to stop unnecessary payment processing fees.
Let’s see how much more money could be in your pocket. If your laser hair removal clinic generates $800,000 per year in revenue with a net margin of 10%, you earn $80,000 for yourself as the owner. You may be perfectly satisfied with $80,000 per year. But you could easily earn more without even increasing your revenue. Because what if you’re paying 3% in credit card processing fees at your laser hair removal clinic? Considering the treatments you offer, credit card payment could be how you receive 65% of your revenue. The could mean the following:
That’s insane!Now, what if you eliminated those credit card processing fees? Well, in this example, your income as the owner of a laser hair removal clinic would jump from $80,000 to $95,600 overnight. That’s a salary increase of 19.5%!Evidently, it pays to pay attention to what your MSP charges. Over a decade of doing business, it could mean more than $150,000 back into your wallet. Think of what you could do with that money:
The point is: You don’t have to pay ridiculous fees to your MSP. By taking steps to get rid of credit card payment processing fees at your laser hair removal clinic, you can get the money you deserve.
You don’t simply pay one fee to your merchant service provider. You pay several fees:
Combined, these make up your total fees. But it doesn’t end there…In addition to your total fee, you could pay cancellation fees on transactions, though your MSP should waive this (do ask!). You may also not get fees back even when you issue a client a refund (discuss this with your MSP). Even worse, your MSP may implement rate increases due to “inflation”. Don’t agree with this. Because credit card processing fees at your laser hair removal clinic are a percentage of each transaction—and therefore naturally rise with your prices.Even though running a laser hair removal and waxing treatment business gets busy, take the time to figure out how you can avoid payment processing fees. Your efforts will prove worthwhile. Because what you pay your MSP each day, month, and year is not only excessive, it’s also unnecessary.
A cash discount program gives you the best of both worlds. You can decrease payment processing fees at your laser hair removal clinic and waxing salon. And you can still accept credit cards. How does that work? Well, a cash discount program empowers your clients to choose the most convenient and affordable payment tool. The program utilizes a surcharge structure designed to reduce credit card transaction fees as much as possible. The best thing about a cash discount program is that it’s a win-win. As the operator of the laser hair removal clinic, you increase margins. And your customers save money. And don’t worry, a cash discount program is also 100% legal and compliant. Want to learn more about how your laser hair removal clinic can benefit from a cash discount program? At NadaPayments, we can tell you all about it and set one up for within a week. Call +1 (929) 293-1800 or click the link below.
The right time to start a laser hair removal business is right now - because the laser hair removal salon industry is still in its growth stage (Study Link) and expected to hit $1,378.4 million by 2027.
One of the reasons IPL hair removal treatments are gaining popularity is it’s proven efficacy in preventing hair growth. Also, the rising emphasis consumers place on their looks and physical appearance is driving the increase in hair removal services for both women and men.
It’s clear that there is room for new entrepreneurs to start their own IPL Hair Removal businesses – and for established spas and salons to seriously consider adding IPL Hair Removal services for their clientele.
Plan, plan plan
Before you begin you need to create a Business Plan. The most common mistake for new business owners is to jump in head first without doing proper research and planning. By planning beyond your initial costs and first year, you will be prepared for the ups and downs of business ownership.
Consider your finances carefully when developing your business plan and be sure to allow for unforeseen costs after your initial start up. When starting a laser hair removal and skin rejuvenation business, your plan should include the cost of the laser purchase, costs for your office, including waiting room, reception, consultation and treatment rooms. Be sure to also include the cost of employees, ongoing marketing and advertising costs and supplies. A budget will allow you to understand your ongoing costs and together with your estimated revenue, you can compile a cash flow forecast allowing you to see at a glance how your business will be doing in the coming months.
A sound business plan will keep you from 'shooting from the hip' and making decisions that could negatively effect your company.
Type of Business, licenses and approvals
Will you be a Sole Proprietorship or Partnership? Are you going to work from home or rent commercial premises? Depending on where your business is based you will encounter different considerations. For example, if you are home based you need to ensure that you inform your mortgage provider and your home insurance company to ensure you are allowed to set up a business from home and you will also need to research municipal zoning regulations to see if this is feasible in your area. Whether working from home or in a commercial premises, you will need a business license and this can be also arranged through your local municipality.
For more detailed information, please go to www.canadabusiness.ca
Anyone who operates a personal service facility, such as hair salon, aesthetics, body piercing or tattooing, requires an 'Application for Health Approval'. You local municipality business license department can also give you the health inspection contact information. Generally speaking this involves having both safety procedures and sanitation regulations in place and followed.
TIP: Displaying both your Business License, Health Inspection Approval as well as your Laser Training Certification increases confidence and credibility with your clients
Finance
Every business requires a bank account. This can be done through any local bank and remember, your account manager is your business partner and your advocate. They are your connection to banking specialists and provide the gateway to flexible and innovative products and services to meet your business needs today and help you plan for success in the future.
It is definitely also worth getting a good accountant or bookkeeper – they are an additional cost but invaluable - as they can set up a cash book and cash flow forecast, so as you know exactly how your business is doing and can make adjustments as necessary.
Insurance
It is advised when opening a business, you discuss your business and your requirements with a qualified insurance broker. I cannot stress enough how important it is that you have the necessary insurance in order for you to work, it is there for your protection as much as the clients and is essential. You must obtain public and product liability insurance and professional indemnity.
bodesi' are exported all over the world and different industries with quality first. Our belief is to provide our customers with more and better high value-added products. Let's create a better future together.
Treatments and Pricing
What treatments are you going to offer? Beyond Hair Removal, an IPL can also perform Skin Rejuvenation treatments. I realize you can only offer what you are trained in, but are you going to try and specialize in something to make yourself more unique or will you offer everything? How are you going to price your services? Check out your competitors to see what services they are offering, and collect price lists from all local beauty salons and home based spas who work in the area. You will probably find these prices are similar so price yourself similarly to your competitors. But always you make sure you work out your costs first, and that you are not cutting your margins too fine – you must know what it is costing you to do business before you even consider pricing yourself the same as everyone else.
Marketing your Business and Services
Lets face it, this is the fun part, the time when we get to be our most creative in coming up with our business name and ideas of how to reach out to our audience!
Define your audience.
Who will your customers be? Are you aiming for a certain market or age group? Are you aiming for just local clients or further a field? Do you want a younger client base? A more mature client base? A wealthy client base from prominent neighbourhoods?
The key to successful marketing is to know who you need to reach with your message and how to reach them.
Locate your audience.
Call a marketing and mail list provider such as Info Canada. Tell them about your targeted audience and purchase a mailing list, call list or email list. Research the media outlets, which your targeted audience is most likely to use. For this type of business you should consider advertising on the society or fashion pages of your local paper, website, social media, magazine and radio stations which have a strong demographic of female listeners such as top 40 or family friendly stations.
Publish materials.
There are various forms of marketing tools that can be used, but be sure you brand your business to your intended audience. Make it accessible, affordable and easy. Publish material that has pictures (before and after shots). Include information about your specific procedures and don't forget your contact information!
Place ads and deliver materials. Put your materials in as many places as possible such as spas, store, malls, salons, coffee shops or doctors’ offices. Create and monitor your Social Media pages, such as Facebook, Instagram and Twitter. Add yourself to industry groups on Linkedin to keep up with the latest trends and technology as well as grow your professional circle. Also, place your ads in newspapers, magazines and website which are targeted to your demographic. Keep your logo and font consistent on all ads and materials so your ads and brand become recognizable. This is the first part of your brand building – the second part is creating the experience once the client comes through the door.
User testimonials.
If a customer is very happy with their Hair Removal or Skin Rejuvenation treatment, ask them to write a short testimonial and make that testimonial a part of your promotional efforts - this is a great way to build credibility as well as increase referrals
Hopefully these business tips will give you the inspiration to get started on the right foot with your medi-spa - and for more in-depth articles - sign up for our newsletter.
Further reading:
How to Become your Own Beauty Business Boss
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