Why my haircut price is gonna double (so YOU can make more money)

10X Business Letter
Aug 29th, 2013
San Diego, Ca
Gorgeous 74 Degrees
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

Dear Business Builder,

I have been going to the same hair stylist almost ever since the day I moved to San Diego. He is a fantastic stylist and an even better person.

When you are sitting in that chair you are giving that person a lot a trust — I mean WHO wants a bad haircut?

We have all had them. My sister happens to be a hairstylist up in Seattle. Other than my mom and my sister, nobody had touched my hair until the age of 18. I am VERY particular about who cuts my hair (READ: vein).

I pay more than your typical Super Cuts would cost you, but to me, it is well worth the price, KNOWING I'm in good hands.

You really get to know someone when you just sit and speak with them on regular basis. After 4 years of sharing personal information with each other you start to develop a real relationship.

His calendar is packed and he is virtually out of bandwidth and working himself into the ground.

Every time he cuts my hair we talk about his business frustrations and about how he could make more money and work less.

I KNOW I could help him double his business.

It pains me when I see people that I care about working harder and making less than they should be.

I don't blame him though, I have been involved in marketing and business growth for 20 years. I'm sure everything we talk about is greek to him.

He just 'yeses' me to appease me.

It'd be like him talking to me about the latest technique in cutting 'luxury designer bowl cuts' [that’s his niche specialty :)]

I want you to make MORE money and work LESS… so,

I'd like to talk to you about the philosophy I was trying to convey to him.

What I'm about to share with you has the power to completely revolutionize your business as well.. so listen up!

Here's what I told him: "the first thing you should do is DOUBLE your price."

He wasn't ready to do that (READ: his butt puckered).

Let's take a look at why I said that.

Firstly, I'm already a client — and I believe I'm his IDEAL client (for the current services he focuses on, but more on that later). I value his service and appreciate what he does for me and I'm willing to pay a pretty premium.

There is really only 3 ways to grow revenue: increase the #clients, increase average transaction size or increase the frequency of purchases.

His profit each month is roughly calculated as follows:

#Clients X Avg spend (cuts, products ect) X Frequency (how often they get cuts each month)

Let's say that his current book of business is 150 clients a month and he takes my advice and DOUBLES his prices and HALF of his clients stop using him… he just cut his workload in half but is making the same amount of money.

Let's look at the math:

Before doubling his price:

150 clients X $50 avg spend X .75 times a month= $5,625

After doubling his price: (Assuming half find another provider)

75 clients X $100 avg spend X .75 times a month = $5,625

So as you can see even though he lost 50% of his business he is still making the same amount of money.

The truth is I would be shocked if he lost half his business. He's that good, he travels around the country teaching other stylists and could easily demand the same rates as the most expensive stylists in Los Angeles and certainly San Diego.

All it would take is some smart marketing — but that's another email.

Now, you may be asking why I put .75 for frequency.

I can only speak for myself, and I was going to see him about every 5 weeks. I think that's pretty typical for a male that doesn't have a calendared appointment.

Interestedly enough, after attending one of our events, I noticed that he had come up with a GENIUS way of increasing my frequency from .75 to 1 on the nose.

What he did is create a "clean up appointment". It's a 'value added' appointment where you come in and at no charge and he cleans your edges up.

You're in and out in less than 15 minutes. The genius in this is that you have to schedule your free cut.

This got me in the habit of calendaring a visit every two weeks.

[SIDE NOTE: This is an example of the influence law called commitment and consistency. I didn't even realize what he had done until a few months after he attended our event… I think he was using our own influence stuff on me!]

Let's see how this little adjustment to the frequency effects his monthly profit.

Before improving frequency:

150 clients X $50 avg spend X .75 times a month= $5,625

After improving frequency:

75 X $100 X 1 = $7,500

That's a $1875 increase (approx 33%)!

Like I said, my guess is less than half would find another hair stylist. But even if MORE than half left him, I personally think it could be called an investment in his business.

Here's why: with all his extra time he could be working on his business (remember he's almost at capacity and has very little extra time) — developing better/smarter marketing. He could focus on building a marketing system to attract more profitable clients — like me.

So for example sake, let's say he spends some of his new found time creating a marketing system to replace 25 of the clients he lost, but now at this new price.

Before improving client attraction system:

75 X $100 X 1 = $7,500

Before improving client attraction system:

100 X $100 X 1 = $10,000

So, here is how it was before.

He was seeing 150 clients X $50 X .75 = $5,625

Now he is seeing 100 clients X $100 X 1 = $10,000 that is a 77% increase in revenue, working 33% less time.

So what does this have to do with you?

It's simple. These three numbers are the numbers you should actively be trying to increase.

The number of clients is the obvious one. That is where most business owners spend most of their time.

But the smart ones know that the cheapest and fastest way to increase revenues is by increasing the latter two.

I really hope you think about what was shared in today's article and apply it to your business because if not, it's costing you geometrically…

And I'm sure now, because my hair dresser is on our list, it's going to cost me too!!
I'm sure he's going to DOUBLE my price!

Loving living giving large,

Jeff Paro
Editor, The 10X Business Letter
PS – If you don't feel like re-creating the wheel and would like some help implementing these principles… we can help.

Leave a Comment





This site uses Akismet to reduce spam. Learn how your comment data is processed.

10 Beliefs of a MASTER INFLUENCER

They say what you Believe, you Achieve..

When it comes to Influencing people, do you have the right beliefs that give you conviction to convert? 

10-beliefs

Ready to finally install Game Winning Beliefs?

0 Shares
Tweet
Pin
Share