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Can a business succeed in a HIGH COMPETITION area?

Discussion in 'Starting a business' started by patrickcasey, Feb 7, 2012.

  1. patrickcasey

    patrickcasey New Member

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    Hi everyone, first post so be gentle..
    I'm a hairdresser in one of Sydney's best salons but I'm getting ready to launch my own salon at the end of the year, my only concern is that I live in the suburbs and the city I'm in has a lot of competing salons.

    I feel as though they are all very standard businesses, meaning they aren't that great. My plan is to open a city salon in the suburbs with an entirely new level of standards.
    My fear is that with so much competition, and new salons opening all the time, is my town eventually going to be over run with hair salons and we'll all suffer because of this.

    Can a GOOD business really flourish when there are MANY businesses within walking distance of each other?
  2. KarenC

    KarenC Well-Known Member

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    Hi and welcome to FS.
    There are many businesses in a similar situation to yours.
    It's really about a point of difference.

    There's always going to be more businesses like yours - you have to plan how you are going to be different and why and what you offer.
    And believe in yourself because there will be difficult as well successful times.

    This marketing article from Business Builders might help you.
    http://au.smallbusiness.yahoo.com/g...51815/case-study-missys-place-marketing-plan/

    Plus, go through the Marketing articles (there's loads of them) on Flying Solo starting here http://www.flyingsolo.com.au/marketing
    including this one http://www.flyingsolo.com.au/marketing/customer-service/service-culture-encouraging-customer-loyalty

    All the best.
    Karen C.
    .
    patrickcasey likes this.
  3. sam_leader

    sam_leader Administrator Staff Member

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    Welcome to the forum, Patrick,

    I think standing out can definitely happen and hope you are able to differentiate your business. For me when it comes to hairdressing, it's about the quality of the experience and the cut. I also find 'top salons' a bit intimidating, but maybe I've been out of the city too long!

    Karen's already made some great suggestions and I'm sure others will hop in with some top tips too.

    Love your work,

    Sam
    patrickcasey likes this.
  4. yourvirtualboard

    yourvirtualboard Active Member

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    Don't forget supply and demand – while it is high competition, in your industry there are a lot of potential clients, therefore a lot of salons. I have seen centres with 3 salons and all busy. If my wife is anything to go by, once she finds someone she trusts with her hair she's a client until they move or we move. How many of your clients might follow you to give you a good start and then Karen has supplied some great info and Sam given you some good insight.

    It may pay you to do a simple plan or at least budget of what you might expect to get as income and what your monthly costs might be and then work out how you can grow the income if that’s what you want to do.
    patrickcasey likes this.
  5. Shaukat Adam (Khalid)

    Shaukat Adam (Khalid) Well-Known Member

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    In most cases the answer is "yes. how?

    By differentiating yourself. Create your own category. Cater to a specific market. Connect with your audience at a personal level.

    When you try to sell to everyone, you have to deal with competition.
  6. patrickcasey

    patrickcasey New Member

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    Thanks for the feedback guys, I really appreciate it. If anyone else has anything to add please feel free to do so.

    I really believe in my quality or work and service, my fear is in convincing clinetelle to visit in the first place, as hairdressing clients are very loyal.

    Again thanks to everyone who posted so far!
  7. Five Star PA

    Five Star PA Member

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    Of course you can succeed! Agree totally, define your differences and then make sure you market these very effectively!

    Make sure the suburb your opening in is economically in line with the prices you will charge. Nothing wrong with charging premium price for premium product but you need to ensure you've chosen the right area.

    Run promotions to get the thing going. Maybe do some cross advertising with some similar businesses ie. Offer free 'DOs' and let someone else put this in their newsletter so your utilising an existing database. From day one I'd be trying to capture clients personal details in some sort of CRM system , make it clear to your staff you need to find out at least one bit of info you can 'sneak' onto the system so next time they visit you can bring it up , ask them how it went and help build that strong relationship that keeps them coming back. Get your Social media happening too, FB and Twitter as if you can get your clients following you, it's easy to run campaigns for quite days.

    Good Luck! I really believe if you're passionate, you'll make it happen!

    Meredith
  8. NickHumphries

    NickHumphries Active Member

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    Yes!
    you just need a point of difference that seperates you from your entire competition! What is it that they don't have? What can you do 10x better and will get people talking?
  9. PaulyT

    PaulyT Member

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    Karen C beat me to it...... point of difference is critical!

    Keep it fresh and affordable?
    patrickcasey likes this.
  10. patrickcasey

    patrickcasey New Member

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    Thanks Guys.

    Does anyone have any good ideas that would make an extra point of difference?. I believe that my biggest point of difference is in quality of work, and a different "larger" understanding of what customer service is and how to be professional (something i find missing around here normally) - these are great points of differences, but it wont get clients through the door.

    Lets face it, doesnt every new business say that they will obtain qualities such as "good customer service" and "the best _____ experience".

    If anyone has any other ideas that could really help me stand out of the crowd i would love to hear from you.

    I am so passionate about what i do and its great to hear from people who are genuinely interested.

    Thanks again
  11. patrickcasey

    patrickcasey New Member

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    P.S Can't believe how great this forum is.... :)
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  12. Perth-Design

    Perth-Design Member

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    Surely that must give you more determination to stand out!

    Just think about what you want your salon to be and make it happen. If you achieve it, the customers will flock
  13. JacquiPryor

    JacquiPryor Well-Known Member

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    Hi Patrick - I am with everyone else - yes, you can succeed even with high competition. The trick of course is making sure that your audience knows your point of difference. I can tell reading this thread you are passionate about what you do and wish to provide only the best service to your customers, but as you mentioned how do you get them in the door to realise that's true about you and your salon?

    What about:

    * Customer loyalty program of some form? I know a number of salons have them - research your competitors and make your 'customer loyalty' scheme better and more appealing.

    * Customer satisfaction guarantee? You obviously believe in the quality and standard of your services so maybe a "if you are not happy with our service your next hair appointment is half price" (or something) - guarantees seem to offer assurance in the first instance, but by making the guarantee something about their next appointment you get them back through the door rather than off to one of your competitors.

    * Some sort of 'opening' offer, for example - first week only all hair cuts only $X (something that's such good value it would be silly to pass it up), or first 50 customers get a free product of some form. Market it by flyers/social media/word of mouth etc and always with the focus of your quality and standard; that the ridiculously low cost is really to provide your clients the opportunity to test you out because you know once they have they will come back.

    I think in your line of business the benefit you do have is once you have a client they are not likely to go elsewhere so getting them through the door with the right offer/loyalty program/guarantee etc could see them remaining clients for a very long time.

    Just my 2c :) All the best with it.
  14. patrickcasey

    patrickcasey New Member

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    These are all fantastic, ill definitely incorporate them into my plan! Thank you so much!
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  15. BlackCoffeeComms

    BlackCoffeeComms Active Member

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    Hi Patrick

    Late to the party, but just wanted to let you know that I, too, work in a highly competitive field (copywriting) and the good news is there seems to be enough work to go around - among the good ones anyway.

    You sound very passionate about what you do, and that's a big start. And I think your POD of being "a city salon in the suburbs" is a great idea. Not of we suburbanites are "soccer moms" and we like to look and feel great too.

    Opening sales are a great idea to attract, and hopefully keep, new clientele, and I'm sure your happy current cients will follow you (is it still the case the hairdressers can't move within a 5 k radius?).

    With all that said - my local shopping centre had four salons not that long ago and two have recently closed - one a franchise and the other a husband and wife team. The only two left are a "Just Cuts" and a small barber that has recently branched into women's haircuts. The one I went to was the franchise and, as I understand it, the lease expired and the shopping centre wanted to double the rent, so they closed up. I'm going to try the small barber (my kids go there), but if that's no good, I am willing to travel to find a good stylist.

    Good luck!
    Last edited: Feb 8, 2012
  16. NickHumphries

    NickHumphries Active Member

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    We fix $6 haircuts: http://link.brightcove.com/services/player/bcpid1125919467?bctid=62304572001
  17. tonyk

    tonyk Well-Known Member

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    There ar plenty of hair salons in my area but I've gone to just the one in the area I live in because they provide a friendly service and always know what I want. Provide a top-notch service and soon word will spread and you will thrive.
  18. AngelaGirl

    AngelaGirl Active Member

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    "a good business".. probably not.

    A "remarkable/extraordinary/awesome business", absolutely yes!

    Get your hands on Seth Godin's book "Purple Cow" for some great inspiration on being "remarkable" and how to stand out in a crowded market.

    Good luck with it!

    Angela

    ps. My most memorable visit to a hair salon included as part of their standard service: choice of cappuccino/real coffee/hot chocolate, good quality biscuits, super comfy chairs and an extra long, deep scalp massage with every wash... the hair cut cost a bomb but it was worth every cent for the luxury.
  19. Astrid

    Astrid Active Member

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    Hi Patrick

    Jacqui's points are great, that's what my hairdresser offers too. Plus a special deal for my birthday and an extra treatment when I rebook within a certain timeframe. And they have a 'recommend a friend and get a refund' program. Or raffles for everyone who on their visit books the next treatment.

    I don't care so much about the quality of coffee or biscuits, they are good most of the time.
    What I want from my hairdressser is that they are listening to my ideas and tell me if I'm wrong or if there is something that would suit me better.

    I expect from a good hairdresser that their salon is clean, no hairs on the chair or table and a change of scissors should they fall on the floor (you have no idea how often this doesn't happen). No draught when you sit there waiting with wet hair.

    And what I really would like (and so far I couldn't talk them into it) is if they would take a digital photo after a great haircut and store it in a database so that they always can go back to it for reference.
  20. KarenC

    KarenC Well-Known Member

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    I love Astrid's idea of the digital photo for reference.
    How good would that be and what a point of difference.


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