large francise killing me

[clubsuni]

I am a mom and pop salon. Been in business for 10 years. 8 beds. During my busiest year (1998), I was tanning 60-80 people during the slow season and 175-225 during the peak season. There were 2 other mom and pop salons in the area but they were healthy competition. Our prices were generally the same and we all appeared to be doing well. In 2000, one of the mega salons moved across the street. They started running specials for $.10 per minute tans ($2 for a 20 minute visit). They advertised like crazy and people were lined out the door. Of course, this was in January so they basically bought all of the tanning business for that year. I thought that this was a one time promotion just to get people in the door. But oh no, they have offered it twice a year for the last 3 years. I've done the math and it would be cheaper for me to pull the closed sign than to offer these ridiculous prices to compete. Plus, I cannot come close to advertising like they do. I do have my regulars that prefer my salon because we change our bulbs early, offer appointments and more personal service. Unfortunately, money talks to most people. Even if they have to wait an hour to tan. I remember when tanning costed $10 per visit in the early '80s. When I got into the business, it was around $6 per visit. Now it's less than $3 per visit. Other large salons in neighoring areas have also started charging $.10 per minute during special promotions to compete because there are actually 10 of these mega salons in a 15 mile radius. Anyway, we are now tanning 20-30 people during the slow season and 80-100 during the peak season. At the rate our numbers are dropping, we expect to be open 2 more years. It's deja vu. Just like Blockbuster did several years ago to Mom and Pop vidoe stores. The only thing that makes me smile is that we did really well for 10 years and these mega stores are going to have to work twice as hard as I did to even make the same amount of money if they continue charging such riduculous prices. They have set the standard for tanning prices in the future and they are going to have to live with the consequences. Because it's always easy to lower prices but impossible to increase them once the public is used them. I am writing this just to prepare other Mom and Pop salons. If you can afford it, expand now!!! Maybe that will deter a mega salon from moving in. Also, you will be able to offer lower prices if necessary to compete.

Good luck everyone!!!

	Superior UV

[engfant]

I don't think the mega salon is doing as well as you think. You can ride tanning equipment just so hard for just so long before it starts to crap out. It's gotta cost huge money to run that place and can't be nearly as well kept as your place. Your problem is, as you mentioned, there are 10 of these salons. You should start catering to adults. They are the people that don't have time to hang around. They are also able to throw down $100 for a package and expensive lotion. Forget the kids. They have no dough.

	Superior UV

[clubsuni]

Engrant,

[clubsuni]

Engrant, I said the exact same thing 3 years ago. I figured that after customers got sick of waiting for more than an hour for a bed that did not deliver as good of a tan, they would return in herds. And some did!!! But the almighty dollars speaks especially in this economy. And the people waiting in line at the other store are adults!!! Not just kids. I also agree that they can only do this for so long. I've been waiting for them to close up shop or at least wise up and discontinue their promotion. But they don't. They are a francise and have to follow the rules of the francise so if the top dog says "all of you have to run the $2 tanning special in January", they have to do it. Even if their location is doing well charging regular prices. Kinda stinks for each owner. Thank you for your positive attitude and let's hope you are right. In the meantime, I am weighing my options for future jobs or businesses. It doesn't hurt to be a step ahead of the game.

[FireGoddess15]

All it means to me is that I need to be wiser with my money. I need to be careful with where I advertise and how much I spend. I need to be extra friendly and make sure I make friends with my clients. It's all about the extra special attention at our stores, not the specials.

[Panache]

FireGoddess, being "extra friendly" just isn't going to cut it girlfriend. Bottom line, the majority of clients will go where the prices are cheapest, as long as they get average color. But, that's where tanning is headed. It's becoming a commodity, and people won't be paying a premium much longer. You can smile until your cheeks ache, and establish a personal relationship with your clients, and you will think they are being loyal to you until you drive by the big boy salon and see your "new friend" standing in line with the other 140 people.

[unity]

I agree with Panache given your scenerio. Our salon does very well with a friendly staff but we have no major competitors, there is one big chain but the threat is minimal - mainly because thier location to ours. It sickens me that a lot of people just look at the price! They could come to this salon, get tanner quicker/darker and get advice taylored to them. But instead they would rather spend the same ammount, in the long run, but have to tan twice as much and probably damage the skin the first few times cause the techs dont care/know better. We have had a couple local High School cheerleaders leave us for another salon for the month or so because they offer a better deal. These same cheerleader sought donations to thier school which we gladly did, generously. Cutomer Loyalty is becomming a great commodity among the young

[tiki]

Want to offer something better, different and more exciting in your salon than they do? Drop me an email and I will forward all my information to you. I help many tanning salons increase profits, membership and product sales with my incentives and I do offer them exclusivity in their immediate area.

[phlash58]

I am a franchisee, all Planet Beach salons are owned buy independent owners except for two stores. We now have over 200 stores nationwide, Canada and Australia. Price is not the question...IT IS ALL ABOUT customer service, cleanliness and selection, price is about # 4 on the list of what customers look for.

[LauraT]

Yikes. I am considering buying a salon in my area and I found out in a round about way that some "investors" are looking at my area and another about 10 miles away for possibly opening a franchise out of Cali. Any advise on how I should handle this info in making my decision. Should I just walk away from the deal or is that over-reacting?