Hairdressing is the dominant service in the hair and beauty sector: recent IbisWorld report sets the haircare service accounting for 65.7 percent of industry revenue. But it’s also a highly fragmented sector with the four top hair service brands combined accounting for less than 10 percent of the market. The Just Cuts brand has a 2.1 percent market share.
1. What are the challenges today for a hairdressing business?
“The challenge for today’s business is a busier lifestyle; there are fewer consumers visiting shopping centres and there is less job stability. However, even in times of economic uncertainty, people still need a haircut.”
2. Will there be further diversification into different outlet models?
“We have recently developed and launched our very own exclusive world class hair care product range, Justice Professional, which includes some sulphate-free products. We are expanding this range into electrical equipment and are confident we are moving into a very strong services and retail space.
“We have also developed the Just Cuts kiosk concept which is a great tool to continue and expand our strength as a multi-unit franchise system,” says Denis McFadden, founder and CEO of the Just Cuts chain.
More than 43 percent of the franchisees own more than one salon.
The chain’s digital platforms – which include an app, mobile website and social media channels – add to consumer convenience and are seen as strong tools for the brand.
3. How important is good training for hairdressing staff, and what role does the franchisor play in this?
“It’s extremely important! The challenge is getting out there to reach each and every one of our 1,600 stylists. We have developed more than six online training modules that can be accessed online 24/7.”
Training modules include end-to-end customer service audio-visual training, induction and franchise business systems, OH&S, YouTube and video product knowledge and styling training. An operations and training team is on the road delivering face-to-face training in salons and at the head office Just Cuts Academy.
“We have also developed diverse training toolkits franchisees and team leaders can utilise to train their teams and individuals. We measure our compliments and complaints and have significantly improved our client experience with incentive and reward programs for our stylists and clients.”
4. How can franchisees increase their profit levels with such a high labour cost to their business?
“Things have changed at Just Cuts and the chain is no longer just about a haircut,” says McFadden. “We are about empowering our client to create the professional salon look at home. This requires the stylists to make the correct recommendations and educate their client about which product would suit their hair, how to apply and get the desired look at home.
“The launch of the new range allows franchisees to increase their bottom line and improve the clients experience. One of our primary KPIs as a business is a superior client return rate and this ethos allows us to focus on increasing profit levels whilst delighting our clients, which is paramount to ongoing growth.”
5. What are the expansion plans for the business in Australia and overseas?
The company is ready to expand overseas with the right partner in a master franchise arrangement.
“In Australia, an extension to the traditional salon is the kiosk concept which was launched in Westfield Doncaster. The $100,000 cost of this is approximately half the price of a regular salon.”