Suppliers cautiously optimistic about recovery of salon industry
Feedback from beauty suppliers indicates that business post lockdown is starting to pick up after a slow start.
Despite reports that some salons have closed as a result of the COVID-19 lockdown, Jacoline Wentzel of The Spa Warehouse has found more new salons opening than closing. She explains: “As therapists are losing their jobs in the bigger salons and spas, they are opening their own smaller establishments.
“In terms of our sales, July was a little slow, but August is a lot busier as the industry is slowly but surely opening up and the sun is coming out.”
Lea Castro of Looking Good LCN says that while sales are lower by approximately 30% compared to the same last year, her team remains optimistic. “All of our top salons are still trading countrywide,” she notes.
A RegimA distributor reports that sales from May to August were down by 20% to 40%, but with a steady improvement since then. The distributor notes that retail product sales have recovered far better than salon products.
Exclusive Beauty Solutions, distributor of Anesi and CND, found business very slow immediately post lockdown. “Sales are at least 50% less than normal and some of our stockists have closed,” says MD Dalize Havenga. “However, sales are gradually picking up although salons are only buying what they need.”
Wayne La Grange of Blue Sky International, incorporating the Beauté Pacifique, RapidLash and RapidBrow brands, comments: “There was huge excitement as we opened with great sales, which was followed by a dip but we got back to normal business in August. Our expectation is that we’re through the worst in our business year. We have already seen a 35% increase in sales versus July 2020.”
SKNlogic has experienced an increase in sales of over 20% for June and July. Says Natasha Delport: “We have continuously had sales since May, as we were helping salons retail remotely. Sales traditionally increase in September, so we’re hoping to see the same increase this year.”
Dermalogica SA CEO, Cherie ten Hope, reports that while the month of May offered a welcome reprieve with the permitting of retail sales in Level 3 of lockdown (albeit primarily online and in Dermalogica concept stores), overall sales are far from normal levels, given the slow return of clients into salons and the treatment arena.
She continues: “Most salon purchases are down from 30 – 50%. Fortunately, we were able to pivot successfully, having planned an overhaul of our ecommerce site last year and the relaunch of our stockist affiliate programme. This allows our salons to earn a commission for sales generated through their affiliate link. Ecommerce is therefore showing significant growth over last year, being a very low base.
“Not many of our salons have closed, just a handful which mostly opened last year. However, we do anticipate more closures as the strain on cash flow persists given the low footfall of clients, as well as the reduced volumes permitted into salons. Also, consumer spend is understandably under pressure.”
She notes that salons are being very conservative and cautious in terms of ordering product and having to manage outstanding debt, low client footfall, expenses etc. Furthermore, with COVID-19 infections spiking, customers are being particularly cautious around returning for treatments as normal.
“The lower footfall and anxiousness around treatment is anticipated for some time and the lowered performance levels are expected to continue for a while yet. That said, we are finding that the demand for treatments and the desire for clients to return to their normal routines is definitely growing.
“Clients are continuing to buy their home care products and many have embraced virtual skin consultations and live chat skin care advice in order to assist their purchases, or to seek out more information. The necessity of wearing PPE (Personal Protective Equipment) has caused many skin issues that our therapists have been helping resolve through products and advice,” comments Ten Hope.
As yet, Dermalogica SA has not taken another price increase since its annual increase in March. Ten Hope continues: “However, since the start of lockdown, the rand has devalued by almost 30% and the impact of this combined with reduced sales volumes is being felt. While we aim only to revisit pricing next year, we need to remain dynamic given that the situation is ever changing.
“Whilst this has been a very challenging time, we are all being given an opportunity to review, reinvent and evolve. Having just hosted the first virtual skin party with over 400 attendees, we are committed to embracing the changes and what is being called the new normal. A business, brand and mindset built to adapt is more important than ever before.”