Intro: Do you feel like you were meant to have a kick-ass career as a hair stylist? Like you got into this industry to make big things happen?
Maybe you’re struggling to build a solid base and want some stability. Maybe you know social media is important, but it feels like a waste of time because you aren’t seeing any results. Maybe you’ve already had some amazing success but are craving more. Maybe you’re ready to truly enjoy the freedom and flexibility this industry has to offer.
Cutting and coloring skills will only get you so far, but to build a lifelong career as a wealthy stylist, it takes business skills and a serious marketing strategy. When you’re ready to quit just working in your business and start working on it, join us here where we share real success stories from real stylists.
I’m Britt Seva, social media and marketing strategist just for hair stylists, and this is the Thriving Stylist Podcast.
Britt Seva: What is up and welcome back to the Thriving Stylist Podcast. I’m your host, Britt Seva, very excited to answer a question from the audience today and talk about what is up with this freaking industry we’re a part of. Is it growing? Is it shrinking? What does the data show? How do we prepare? What do we need to know?
This was a great question and this was a question submitted by one of my Thrivers Society members. If you ever have a question that you want to submit to the podcast, the best place to do it is by leaving a rating or review on iTunes, leave your question in the comments. That is my favorite place to pull inspiration from the podcast from.
Here’s a question that was submitted directly to me. It says, “I am wondering where and how the 30% statistic on industry leaving comes from. Is it stylists, independent stylists, salons, education area, etc.? At least simply put, I am watching it happen here. I also see the other trend, the emergence of new cosmetologists. I’m also wondering if you can shine some light on that as well. I would’ve thought COVID would have slowed it down and put some off, so I’m thrown off a little bit on that one, but again, I’m seeing it happen already, especially the exodus,” which is such a bummer, right? So she’s already seeing the mass exit from the industry. “As always thank you, Britt and team, for the hard work and the confidence and drive I needed desperately to stay out of that exodus. You’re all wonderful. Thank you.”
Well, it’s my pleasure. I’m glad you’re not a part of the exodus. I’m glad you’re still here in the industry.
I still think our industry is one with tremendous and massive potential. I wouldn’t choose to be in any other industry, personally. I think the personal care services industry is increasing in demand, and I think that we’re on the cusp of what I keep calling a revolution.
I’m going to get into some stats and some data in a minute, but I want to speak to a little bit of what’s happening.
I’ve been talking about this for a few years. This is not new to me. I started the podcast in 2018 and I’ve been talking about it since then. We are in an era in the industry where, for lack of a better word, the cream is going to rise to the top. There is a divide taking place. Now what’s exciting is that this could be an industry of straight-up thick whipped cream. Like there’s no reason why everybody in this industry can’t end up on the flip side.
The problem is so many are still unwilling to shift the way they look at their business and truly embrace the potential that it has. I hosted a workshop in September of this year called Less Work, More Wealth, and one of the exercises on one of the days was to create two what I called “freedom numbers”: a one-year freedom number and a five-year freedom number.
It meant in one year, what income level could change your entire life? And then what do you want to be shooting for for full freedom in five years? Okay.
Reasonable question. Great question. Trying to get people to think outside the box. And I said, okay, great, so then go to your Less Work, More Wealth group and share your numbers after. I waited a few hours after I taught the class and then I went and looked at the feedback of what stylists and salon owners were listing as their freedom number. And it made me say, “Wow, I still have a lot of work to do.”
There’s a huge part of me that feels like I’ve really impacted the industry. A lot of people have heard my messages and a lot of people believe in what I say. Then I watched that happen and I thought, “Oh my gosh, I really am just getting started,” because I saw what those freedom numbers were—and it’s not even about the income level. I’m in California, so I know it’s more expensive to live here than it is to live somewhere in the Midwest or something like that. It’s just different, right?
It’s not even about that. It was the slow growth that people were projecting for themselves. It was like, “Well, I’m going to make 55,000 this year. So if I make 65,000 next year, that’ll be freedom. And then if I’m making a hundred thousand in five years, that would be great.”
That is thinking so small. That is not being the cream. I just have to say it.
There is so much more potential in this industry than that, and when we’re saying my hope is to go from 55,000 this year to a hundred thousand in five years, that’s projecting a 10% business growth. That is not considered healthy by any business standard.
That’s not just me being picky or me trying to push everyone to be more and do more. If you were to hire a business consultant, any business consultant will tell you if your business is not growing by at least 15%, at least 15%, it is shrinking.
A healthy business grows by 15% a year. And then that growth is compounded, right? Because if you’re making 50 grand a year, well then 10% growth is $5,000 more right? 10% of 50,000 is five, so then 55,000. So then the next year, 10% growth is 5,500. So it’s a little bit more. And then the following year, it’s a little bit more, a little bit more, it’s a little bit more, so it’s compounding growth, right?
Any economist will tell you if your business is not growing by at least 15% year over year, it is considered unhealthy and risky. I’m going to share some statistics that will spell that out as to why.
The reason I’m sharing this is because I want you to know it’s unfortunate that so many are losing their businesses still. It’s unfortunate that we’re seeing an exodus in our industry, but it is due to the fact there is a massive lack of business-based education in our industry that speaks to the skills and knowledge and tools and tactics that beauty professionals need to build and grow their business in the way that they need to so that it can sustain, period. It’s what it comes down to, right?
Let’s look at some of the statistics as to why this is happening, why we’re still dreaming small, why we’re still thinking small, and why we end up in this position.
One of the things that this stylist asked about was the statistic that 30% of stylists and salon owners are going out of business. That was a statistic that came out earlier in, I believe it was a 2020 statistic. I haven’t seen that this year. If it’s floating around somewhere, I just haven’t seen it, but I wanted to look up some data to see where we’re at. I found an article out of the Wall Street Journal, and this was from the spring of 2021. This may have actually gotten worse, but let’s hope not.
What this says is the pandemic resulted in the permanent closure of roughly 200,000 U.S. establishments—that’s only in the United States, by the way—above historical levels during the first year of the viral outbreak.
In 2020, actually let’s assume this is meaning from March of 2020 to March of 2021, okay? Because that’s just around when this was released. It’s 200,000 businesses more, not 200,000 total. It’s 200,000 above. It says, generally speaking, in recent years, 600,000 establishments permanently closed year over year, or approximately 8.5%.
We know that statistic to be true. Every year, businesses will close, period. Not 100% of businesses stay open every single year, like businesses close all the time.
What this is saying is statistically 8.5% of businesses closed every single year, so 600,000 a year. What it’s saying is out of the pandemic, we had 800,000, almost 1 million businesses close.
Then it goes on to say individual companies account for about two-thirds of that additional 200,000.
So that means small businesses: You, me, stylists, salon owners, all of that, individual sole proprietor businesses, LLCs, things like that, right?
Then it says one third were major companies. We saw the Disney store, I don’t know if it’s everywhere, but in California, a bunch of Disney stores are closing. A lot of major stores out here are actually closing. That’s one third, is major stores and brands scaling back or closing down. But two thirds was more like local small businesses.
Now here’s what upsets me about this article. It says barber shops, nail salons, and other personal service providers appear to be hit the hardest. According to a fed study, more than 100,000 establishment closures beyond historical normal occurred between March of 2020 and February 2021.
This federal study that they’re referring to showed that 100,000 stylists and salon owners walked away in the last 18 months and that’s devastating. That’s devastating. This is an industry that has already struggled for so long, and then to watch a six-figure amount say, “Forget it.”
I had to tell you, some of my favorite salons in the Bay Area, like some that I admired, closed. I think that a lot of those owners just went to like suites or said, “Forget it. I’m scaling way the heck back,” but some did walk away.
I know a lot of salon owners now coming out of 2020 who were like, “I gotta get outta here. I don’t want any part of this.” It really changed the idea of business.
For me, when I say we’re in the middle of a revolution, or we’re in the middle of a great divide, this is the realness of business. Everybody wants to be an entrepreneur when it’s fun and sexy and profitable and it’s Lambos and wads of cash. That’s great.
But business through the hard times sucks. It’s so painful and so hard. It’s also so real.
Historically every decade or so, the economy bottoms out. You have to know it’s coming again. It happened before, it will be here again. This is the reality of business.
Now, when you have a strong business that is profiting 15% or more or growing, I shouldn’t say even profiting, growing 15% or more year over year, you’re going to be able to weather the storm of a rough season of business when you are running so tight, that profit is tight. You’re not really growing at a rapid rate. Something like this is really difficult to get through.
So my guess and my ask is that I think in the next few years, we are going to see this industry rise, which makes me very excited. But those who don’t choose to rise to the occasion are going to be left behind and it really scares me for those who aren’t down to take the journey. But we learned in a really hard way that we need to get really serious about business if we’re going to continue to weather these storms.
Her question was about the exodus and yes, the exodus is statistically there, a hundred thousand walked away, historical number on the negative side.
This is why I have said, if your business is not exploding right now, you have a problem. Something’s not right because there is an abundance of opportunity to build a clientele right now. We are at a massive low of service providers. That means a surplus of clients looking for amazing professionals to work with.
This is why I say now is the time to do coaching, now is the time to join Thrivers, now is the time to do Wealthiest Year Yet because this is arguably the easiest season you’ll have to build business in in the next 20 years. Honestly, this is it, we’re in it, so don’t waste time, like you got it now.
Then she said, “But I’m also hearing statistics about growth,” and I am too. At the time of recording this podcast, I’m preparing to give a keynote somewhere, and one of the things I’m talking about is the statistic coming out of the U.S. Bureau of Labor and Statistics that says the job outlook for hair stylists and cosmetologists and barbers over the next 10 years is a projected 19% growth in licensing. That is labeled as much faster than any other industry’s average.
Whoa. So a.k.a., competition is coming.
How come? One of the things she said was like, man, if a hundred thousand people are leaving, why is there this surge of people coming? Well, first of all, I don’t think people are dumb. If a bunch of people are leaving, there’s a great opportunity to join this industry where there’s now a surplus of clients, so the new people are coming.
And what we’ve learned in the last five years is that recent graduates of cosmetology school come in much sharper than I did when I joined the industry in 2007. That’s something to note. The other thing is that trades in general are seeing a pretty good surge right now. There is a real shakeup in the college system here in the United States specifically and we’re seeing a big push to trades, head to toe. We’re seeing it.
So while our industry is certainly growing, trades in general are growing in a really big way.
Now I will say, I learned this from my father-in-law, who was a retired pilot—big shout out to him for everything that he’s done—and he told me that the airlines had 10,000 jobs become available. They are in need of 10,000 pilots right now because so many people chose to make big career changes after 2020, after furloughs, after layoffs, after everything going to uncertainty, they said, “Well, I’m going to take this as the opportunity to try something new.” A lot of people coming out of the pandemic were like, “You know what? This is my time to do what I’ve always wanted to do. I always thought about being a hair stylist, but instead I decided to be a whatever, and here’s my chance.”
You can read article after article after article of this. So many people were furloughed or laid off. They had unemployment and use that time and money to educate themselves. And I gotta tell ya, that’s not stupid. That’s smart, well done, way to use that time and opportunity to better yourself.
We have all of these people who before their story was, “I can’t quit my job to go to school.” Well, now their job went away. They had money to put into school and it seemed to be a sensible option and like, much love, like it was really great choice. So the opportunity to become licensed really increased, and that combination of there’s a real shakeup in what’s happening with traditional college systems, push to trades, and this kind of gap that was created in 2020, we are going to see a surge of new beauty professionals coming in.
Now this leads into some other things. When you look at, now, not everybody in cosmetology school right now is a Gen Z, not everyone’s a millennial, right? There’s going to be all different generations who were in there. But when you look at the younger generations and by younger, I mean like more of the Gen Zs or the really young millennials. When you look at what they are looking for out of a place of employment, friend, it is not the salon of 2010. Let me tell you, it’s not even the salon of 2015. What they want is different.
There’s a great book, it’s called Not Everybody Gets a Trophy, really good book, and there’s lots of others too—I’m doing a lot of research on this right now, actually, so more details to come about kind of what the workforce is going to look like over the next few years.
But I am on the older spectrum of millennial, I guess, and what I was interested in doing at the salon, what I was willing to do, the values that were instilled in me are very different than what this new generation has seen experience has been taught, believes in. This happens all the time.
So for a lot of us, we’re like, “Well, forget it. There’s no hope in them.” I actually think there’s a lot of hope in the up-and-coming generation. The ones that might be hopeless are us. If we’re not willing to be adaptable and change and grow, we’re going to be left behind. We can say the new generation’s annoying, here they come, though. It doesn’t matter.
We can whine about it or we can adapt and say, “All right, well, you know what? The world is evolving. I can either evolve with it or stay stuck in the dark age.” The choice is truly yours.
You can do whatever you want to do, but if you want the opportunity to gain this 19% of licensing that we know, statistically, is coming up the pike, you have no choice but to modernize.
When I talk about the cream rising to the top, the revolution, the exodus, the statistics about people coming in, this is your time to shine. Competition is coming. We are going to need to see a massive change in salon leadership and structure. We need to see a massive change in the way the independent stylists market themselves, present themselves, build trust with their clients, and everything else in between. We need to really build structurally strong businesses. The day of it being adorable to do hair and it being this cash-based underground business, those are fading really fast.
If you stay stuck in that normal, I am legitimately worried because we’re seeing the industry take a sharp left and you can totally play on the other side of that. You can be the resistance and be like, “Nope, I’m not going for it,” and that’s fine. But just know that’s the way that everything is headed, so at some point, you’re going to be left behind and you’ll be the group that’s playing this small data game. If you’re down for that, more power to you, I truly hope it shakes out. I only want the best for everybody.
But as we see this massive update and upgrade in what clients want, what the industry can command, and what a real freedom number looks like when we’re commanding 15% business growth year over year, and what is possible for you and your family and your life, if that growth is obtained, for me, that is true wealth.
That is what is possible coming out of our industry, but just know things, they are a-changing. We are seeing it in front of our eyes, seeing this exodus of a hundred thousand people. It’s one generation coming out and a new generation coming in. Buckle up.
I’m going to do my best to stay sharp, educated, and here to support you through the process. We can do this friends. Thank you to my Thriver who asked this excellent question, and to y’all so much love, happy business building, and I’ll see you on the next one.
