How to Price Beauty Services as a New Salon Owner Without Undervaluing Yourself

Starting your own beauty salon is a thrilling step in your career, but it comes with one of the biggest challenges: pricing your services. Many new salon owners make the mistake of setting prices too low, hoping to attract clients quickly. But underpricing can do more harm than good, leaving you working long hours without seeing the profits you deserve. Pricing isn’t just about covering your costs; it’s about valuing your time, expertise, and building a sustainable, successful business.

If you’ve been asking yourself, *”How do I price my services without scaring away clients?”*—this blog is for you. Let’s break down how to price beauty services confidently as a new salon owner and avoid undervaluing yourself in the process.

What we cover…

One of the most common traps new salon owners fall into is pricing their services based on what they think clients will pay rather. than the true value of their service. While it may seem tempting to offer lower prices to draw in new clients, it can hurt your business in the long run.

Remember, clients aren’t just paying for the time you spend with them—they’re paying for your skill, training, and expertise.

Tip: Research the average prices in your area, but don’t feel pressured to compete at the lowest rate. Consider what sets you apart—your technique, customer service, ambiance—and factor that into your pricing. Don’t sell yourself short!

Before you set your salon service prices, it’s important to know how much your services are actually costing you. Consider all of your expenses — products, rent, utilities, equipment, marketing, and your own salary.

Many new salon owners forget to include their time and effort as part of the cost, leading to prices that barely cover overheads.

Here’s a quick formula for pricing your services:

• Cost of Products Used: How much product do you use per service, and what is the cost?
• Time Spent: How long does it take to perform each service? How much is your time worth?
• Overhead Costs: Rent, bills, insurance — break these down into an hourly or per-service amount.
• Profit Margin: Add a percentage that reflects your desired profit.

Once you’ve factored in all of these, you’ll have a clear picture of what you need to charge in order to cover your salon costs and make a profit.

Pro Tip: Use a pricing tool like Insightful Sums to automatically calculate your costs and set prices that not only cover your overheads but making a healthy profit.

It’s easy to feel pressured to offer discounts or under-price your services when you’re just starting out. However, constantly discounting your services can set a precedent that’s hard to break. Clients may begin to expect lower prices and balk when you eventually raise them.

Instead of relying on discounts, focus on the value you provide.

Offer Value Over Discounts:
Rather than dropping your service prices, consider adding value to your services.

Offer a complimentary mini-service like a scalp massage with a haircut or a product sample after a facial. This way, clients feel like they’re getting something extra without you lowering your prices.

Pro Tip: When you do offer a promotion or discount, make sure it has a clear end date and is presented as a special, one-time deal — this keeps your pricing integrity intact while attracting new clients.

Clients love having options, and creating service packages or tiered pricing levels can help you appeal to a wider audience while protecting your income. For example, offer basic, mid-level, and premium versions of your services to meet the needs of different clients without devaluing your skills.

Example:

• Basic Facial: Includes essential cleansing and moisturizing.
• Mid-Level Facial: Includes extra treatments like exfoliation or a mask.
• Premium Facial: Includes all the works — plus a relaxation massage or specialized products.

This structure allows your clients to choose based on their budget, while you still earn more for your time and expertise with premium services.

Don’t be shy about explaining why your prices are set the way they are. Your clients are more willing to pay higher prices when they understand the value behind them.

If you’re using high-end products, have specialized training, or offer a unique experience, let your clients know! Educating them on the quality they’re receiving will justify the price and build trust in your expertise.

As your salon grows and your skills develop, your prices should, too. Once you’ve built up a steady client base and your bookings increase, it’s time to re-evaluate your pricing.

Don’t hesitate to raise your prices as demand for your services grows. Consider revisiting your pricing at least once a year to ensure you’re still charging in line with your costs, the market, and your experience.

Pricing can be overwhelming, but it doesn’t have to be. Insightful Sums is designed to help new salon owners like you avoid the trap of under-pricing.

With our software, you can:

• Calculate Your Costs: Easily factor in products, overheads, and staff wages so you know exactly how much to charge to stay profitable.
• Set Service Prices: Create prices based on real data, not guesswork, ensuring you’re covering costs and earning what you’re worth.
• Test Profit Margins: See how different pricing strategies affect your bottom line and adjust to maximize profitability.
• Create Packages and Discounts: Plan strategic packages and limited-time promotions without losing sight of your profit goals.

As a new salon owner, pricing your services confidently can be a game-changer for your business. Don’t fall into the trap of undervaluing yourself or offering discounts just to fill your books. Instead, focus on understanding your costs, knowing your worth, and communicating that value to your clients.

With tools like Insightful Sums, you can take the guesswork out of pricing and set yourself up for long-term success. Charge what you’re worth — because you and your business deserve it!