4 Salons in U.S Have Gone Out Of Business: Why, What Happened?
- Premier Salons Beauty Inc – Premier Salons, which operates over 140 salons – many of which are run in popular department stores, filed for bankruptcy in July of 2010. After filing for bankruptcy protection, they sold their assets to their more substantial competitor, Regis Corp.
- Trade Secrets – On October 4, 2010, Trade Secrets beauty salons filed bankruptcy for the second time in 15 months. During their first bankruptcy, they were in the process of closing a number of their 612 total stores. Now they will be closing even more stores in the midst of this new bankruptcy filing.
- Center Stage Salon – After nearly 8 years in business, Center Stage Salon and Spa filed for bankruptcy in July 2010. The closing left 30+ people out of work, and countless customers left with now-worthless gift cards.
- Safety Harbor Resort and Spa – In the fall of 2010, Safety Harbor Resort and Spa – one of Florida’s largest and oldest salons/spas in the state – filed for bankruptcy. The salon and spa has been a staple in Safety Harbor’s downtown area for over 60 years.
Why Dose it Happen ?
Today’s society is extremely fast-paced. Everyone is constantly rushing to get to their destination – their schedules full of back to back meetings, events, and occasions; and very rarely do they get a chance to relax and pamper themselves. But when they do, facilities such as spas and salons are set up for a full body experience in relaxation. When you are a busy executive spending a lot of tense hours at the office striving to meet deadlines and climb the corporate ladder, nothing feels better than a massage, or a new haircut, or even a new manicure. Spas and salons sell their services by touting themselves as a place where the everyday executive can “get away from it all”. For some people, it is the next best thing when they cannot take a literal vacation.
In recent years, the economic climate has not been ideal for consumers, and by extension, spas and salons. When consumers have to tighten their financial belt, usually the first thing they eliminate from their budget is frivolous or non-essential expenses. And with the current economic downturn lasting a lot longer than originally predicted, consumers can no longer afford to go for regular massages, manicures, or facial peels. They have taken a more frugal route of accomplishing these services in the comfort of their own homes. As a result salons and spas have been losing money and customers regularly, forcing some of them to close their doors for good.
Understandably, these types of facilities are expensive to operate and require licensed staff to perform the services they offer. When a spa or salon decides to offer manicure, pedicure, or massage services, they often have to invest in expensive equipment. In addition, the licensed staff that they have to hire to perform these services requires a high-end salary simply because they are specialized services. And if it is a new salon in the process of building a reputation, or an established salon trying to protect its reputation, they can expect to pay top dollar for the best in the field in order to give their customers the most rewarding and relaxing experience available.
Unless the economy turns around soon, salons and spas will continue to suffer loss. They will not only find it necessary to close facilities, but they will also hike prices in an effort to recoup the loss of revenue due to the lack of customers. More established companies such as Mario Tricoci, will also lose revenue but because they are established, they will likely weather the financial storm with minimal changes.