Running a Business isn’t easy. It doesn’t matter if you are a single entrepreneur or own several different locations with an abundance of personal. In fact, it really doesn’t matter what Business it is, running a Business isn’t easy.
Prices trickle down. If the component cost increase, more than likely the product will increase. If shipping cost increase, components will increase, product will increase. If gas increases, shipping will increase, components will increase and yup…you got it, products will increase.
Supply and demand will have in impact on pricing.
If the demand is high (gloves), the supply begins reducing, prices will go up. Hence why our gloves at Centre For Beauty cost us more than double what it did 1-1/2 ago.
In addition as the demand continues to grow, Mfg’s can’t keep up, backlogs happen. As backlogs happen, prices go up because the demand is so high. It’s crazy stuff!
Yet, it is the cost of doing Business!
Consequently, when this happens, people start looking elsewhere for products they use to get from a Supplier, they can no longer get as quickly as they are accustomed to. Sooooo, the supplier loses Business and then may have to raise their prices because the qty. of Business has decreased….sometimes considerable.
What a vicious circle.
The idea for this article cam from a post on social media (of course) which, many of you responded too.
It didn’t really have too do with pricing. It was something about finding the products you need…since COVID.
The answers were quite interesting. The main component being, everyone has been looking elsewhere for products…searching for a better price.
Our Beauty Technicians are doing the same thing they complain their customers do. Shop around.
It also explains what has been going on in my Business. The increase in request for Pro access to our store, has increased by about 25%. That’s HUGE!
Yet, the turn into $$$$ just isn’t happening. THAT has never been the case.
I can only presume….Technicians are price shopping.
I get it, I really do. It’s easier NOT to have a price increase, than it is to listen to the complaints, hear the grunts and experience any loss of Business.
However, what a piss poor way to run a Business.
At Centre For Beauty, we only raise prices when our Mfg’s raise prices.
We have only had two(2) price increases thus far. And, our last one was about 5 years ago.
One Mfg. is dealing with supply and demand. The other Mfg.is dealing with shipping cost. They waited as long as they could yet ultimately hit us with a price increase.
Our shipping cost have increased over 25% and I’ve made purchases 5X what I would normally purchase, because my Mfg. have had a ton of shortages and I don’t want to have a -0- inventory.
It is absolutely insane how expensive, expenses have gotten.
I’ve increased our products cost when we were notified on those two Mfg’s which BTW, even included a few price decreases. I have NOT raised my shipping cost, I still offer FREE FREIGHT FRIDAY (1st Friday of each month) and we still offer FREE shipping on orders of $300.00 or more.
How can I do this?
When it comes to expenses, you should always calculate a cushion where you can. Shipping for me was one of them.
I can’t really put a cushion in my product sales, as cost are dictated by the Mfg. So I used shipping as my cushion to prepare me for a pandemic. Okay, maybe not knowing there would be a pandemic coming….some kind of crisis.
Also a cushion is great for accounting for errors and offering discounts such as birthday coupons, special discounts, show pricing etc. It ALL cost. Expenses are Expensive.
What I’m trying to share is what is happening to you is happening to everyone. As I always say, it isn’t what happens to us, it’s how it is handled.
When COVID hit, many learned some valuable lessons. Lessons like saving more $$$ for rainy days. Lessons like not working as hard, working smarter. Lessons in what our cost are and when to raise prices. Lessons like not waiting until the last minute to purchase products. Lessons in disinfection……the list goes on and on.
What I’m seeing now, is many are back in that same position because the result of COVID is now showing its ugly head. . . once again! Inventories are down and prices are up.
As a Business owner it’s imperative to run your Business thinking from ALL different angles.
#1 lesson – if you remember nothing else…..The sign of a good Manager is being able to ward of problems before they even exist. The ability to be prepared for the worst case scenario. The ability to be prepared mentally and financially.
There is no doubt, times right now are tough. It’s the fear of the unknown. None of us have any idea how this whole Covid thing will end…if ever.
I know many of you re-evaluated your Business during the past few months. For those of you who haven’t, I’m suggesting you do.
- Don’t just look at what your cost are also….
- Look at where your cushion is going to be.
- Look at when the right time is to make changes.
- Write your plan for your next emergency.
- Establish a Business emergency fund.
- Be prepared.
Are you slow? Figure out why. Then figure out what you are going to do to bring in more Business.
Many of you are in Suites. One of the downfalls of being by yourself, is having to do everything by yourself.
I remember saying when Suites and Booth rental first came into play…..Amongst many things….how are you going to constantly market your Business. Where is your next new client going to come from…eventually loss of clients do happen.
This whole topic for me is something I could talk on for ever.
What I would like to say in closing is this; As a Business person it is your obligation to “make things happen”. The ball falls in your court whether it be a happy bounce or a flat. This means everything from Marketing, pricing, problems, clients, accounting, preparedness etc. etc. If there is a problem in your Business…..it begins and ends with you.
Expenses ARE expensive! Question is……are you prepared?