Fully booked but no profit? What each treatment really costs you

By Maffy · 20+ years running spas, salons and clinics · 7 min read

The diary is full. The team is busy from the first client to the last. And at the end of the month, the bank account barely moves.

If that sounds familiar, look at what each treatment really costs you. Very often, some of your most booked treatments cost you almost as much as you charge for them, and nobody has ever sat down to do the maths. I've seen it in salons, spas and clinics in the UK and in Portugal, and it is one of the first things I check in any business.

A full diary can still lose money

Most owners set prices by looking at the salon down the road. That tells you what clients will pay. It tells you nothing about what the treatment costs you. To know that, you need four numbers.

1. Product cost. Everything used on the client: gel, polish, files, wipes, masks, oils. Work it out per treatment.
2. Therapist cost. Wages or commission, plus employer costs, for the real time the treatment takes, including set-up and cleaning.
3. Room or chair cost. Your rent, bills, booking system and insurance, divided by the hours you are open. Every treatment uses a share of them.
4. Fees and taxes. Card fees, and VAT if you are registered.

Worked example: a £25 gel manicure

Now picture that manicure booked 80 times a month. It looks like your best seller. In reality it keeps the team busy and the business no richer.

The per-hour trap

A higher price can still mean less money per hour. Compare what's left per hour once you take off products:

The wrap looks like the bigger sale. Per hour of your room and therapist, the facial earns more. At 10 wraps a week, that difference is worth around £11,440 a year.

What to do when a treatment doesn't pay

If clients love the treatment, keep it, and try these first:

• Add a relevant add-on, with the price. A £8 paraffin treatment with the manicure takes 10 minutes and almost no product. Offered to every client, it changes the maths.
• Cut the hidden time. Prepare kits before the client arrives, and get help with resets at busy times. Fifteen minutes saved per treatment is a quarter of an hour you can sell.
• Add home care. A cuticle oil or a hand cream at the end costs you no room time and carries a healthy margin.
• Review the price. If the treatment still doesn't pay, raise it. A small, regular yearly increase is easier for clients than a big jump after years of nothing.

Do this before Friday

Pick your three most booked treatments. For each one, write down the price, the product cost, the real time including set-up and cleaning, and your room cost per hour. Then work out what's left. The answer is usually the biggest surprise of the month.