40% of hair salons unable to cover reopening costs
The NHBF State of Trade survey has shown that despite reopening in July, many UK hair and beauty salon businesses are still suffering as a result of the coronavirus lockdown.
The State of Trade survey, which ran from August 20-31 and received 2,018 responses, found that three in four salons said business was down compared to the same period last year.
Two thirds expected business to remain slow based on their forthcoming bookings for the next three months, while 35% are worried about how little business they have coming up. Most concerning from the results was that 41% could not say if their business would survive until Christmas.
The results found that although many were yet to make redundancies, almost a third said they expected to cut staff in the next three months and 44% could not guarantee job security for their staff, who have seen their hours reduced (55% across hair and beauty but 74% in the beauty sector alone). Despite financial incentives from the Government, the results found that recruiting either new employees or taking on apprentices was unlikely.
Almost three quarters (73%), have now brought all of their staff back from furlough. However, one in five practitioners in the beauty sector are still furloughed, with less than half of businesses able to operate fully in terms of staff numbers. The beauty sector was particularly impacted due to the extra time they were forced to close and the bans on treatments around the face, with some treatments still prohibited in the devolved nations.
Based on their current workload and the operational restrictions within the Government guidelines, 40% of businesses in the beauty sector were not earning enough to cover outgoings such as rent, overheads, staff costs and stock. To compare, one in four businesses across the entire hair and beauty sector reported they could not cover their costs.
The widely held view of those within the sector is that the Government is dismissive of the hair and beauty industry, does not understand it or those working within it, and underestimates the sector’s value, with one in four stating ‘I don’t feel [the government] understand our industry at all’.
These results are now being used to put pressure on the Government to support the industry to avoid a significant loss of jobs and closure of businesses that currently contribute over £7.5bn in turnover for the UK economy.
NHBF chief executive Hilary Hall said: “Whilst the survey results paint a bleak picture, this does not have to be the case. The recovery of the hair and beauty sector is dependent on additional help from the Government.
“We continue to campaign hard, calling on the Government to provide extra support as they have for hospitality. We expect them to consider additional measures such as hardship grants, VAT reductions, further extensions to business rate reliefs, restraint on proposed wage increases and other measures for sectors like ours that can only offer greatly reduced services, putting the longer-term survival of businesses and thousands of jobs at risk.”