NABB2007-08indstats_TAB.qxp 1/8/08 9:58 AM Page b32 2007 INDUSTRY STATISTICS SPONSORED BY Industry Outlook NAILS readers are a terrific and helpful group of professionals and I thank all of you who responded to this year’s survey. You gave us an intimate glimpse into your business and your thoughts, and I appreciate your openness and trust. The market is down for the third year in a row. More of you told us that building your clientele was the number-one challenge you had in business (although that was the number-one challenge last year as well, this year the actual number of you citing it as your key challenge was much higher). A lot of you are in areas hard-hit economically and your business is suffering as some clients lose jobs and have to cut back on their nail services. Read through this special section for more comparisons and contrasts. Use the information and let me know how we can continue to make it even more useful for you. Special thanks go to OPI Products, with special recognition to George Schaeffer and Suzi Weiss-Fischmann. I know that OPI uses the data around the world in presentations about the state of the nail industry. The sponsorship of this statistics section by OPI Products makes it possible for us to provide truly unique, detailed data on the nail industry, and I thank them heartily. — Cyndy Drummey Nail Salon Services Market Size NAILS’ market size projection figures are estimates derived from our own research. They are calculated (in a proprietary way) based on the number of salons in the U.S., the number of nail technicians per salon in each state, the average service prices of four key salon services, and an estimate of the number of practicing nail technicians. The final figure represents, to the best of our ability, the total amount of money spent in the U.S. in nail salons for services. Figure represents total dollar volume, in billions, spent by salon customers on nail salon services. 7 $6.84 6.8 6.6 $6.43 $6.45 $6.44 $6.53 6.4 $6.43 $6.53 $6.34 $6.24 6.2 $6.16 6 (figures in billions) 5.8 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 NABB08stats_p34-35.qxp 11/5/07 2:10 PM Page 34 Nail Tech Demographics Ethnicity One of the most fascinating aspects of the professional nail industry is its ethnic diversity, or rather the dominance of one particular ethnic group: the Vietnamese, who now represent the largest group of nail professionals (see page 36 for more details about specific demographics). Home Life Married with kids 54.6% Unmarried with kids 13.8% Married with no kids 12.8% Unmarried with no kids 18.8% How long have you been doing nails? One year or less 21.4% 2-3 years 18.2% 4-5 years 10.1% 6-7 years 6.9% 8-9 years 6.6% 10+ years 36.8% 43% Caucasian 36% African-American 10% Hispanic 8% Korean 2% Other 1% What is the highest level of school you have completed?* Some high school How old are you?* 3.9% Finished high school 30.8% Some college 40.7% Finished college 18.1% Graduate school 6.5% 25 or younger 9.1% 26-30 14.8% 31-35 20.6% 36-40 18.9% 41-45 14.5% 46-50 10.9% Over 50 11.2% Gender: Which title best describes your position? Salon owner (doing nails) 36.1% Nail technician/booth renter 23.3% Nail technician/employee 22.2% Student/apprentice STATISTICS Vietnamese 9.5% Salon manager/nail dept. manager (doing nails) 3.5% Salon manager/nail dept. manager (not doing nails) 1.3% Salon owner (not doing nails) 3.8% Cosmetologist 7.4% Note: Figures don’t add up to 100% as respondents identify themselves in multiple ways. 34 NAILS 2007-2008 THE BIG BOOK 96% female 4% male Where do you live? New England/Mid-Atlantic 19.1% North Central 19.4% South Atlantic 20.0% South Central 14.2% Mountain 7.0% Pacific Coast 15.7% International 4.6% *Source: 2006 NAILS Big Book NABB08stats_p36-37.qxp 11/5/07 3:14 PM Page 36 Vietnamese Demographics There are many assumptions made about the Vietnamese salon community and finally we have data to disprove some and confirm others. NAILS Magazine and VietSALON Magazine cooperated on a survey to Vietnamese nail technicians and salon owners in September 2006. The surveys were in Vietnamese and mailed to 5,000 nail technicians in the U.S. We offered a $5 incentive for every completed survey and received 988 responses. We believe this is a positive first step in our ability to benchmark this significant faction of the industry. The area of most controversy is service pricing. Vietnamese salons have a reputation — mostly earned — for providing very low-cost services. This survey bears that out. They have a reputation for having low-end services and offering minimal amenities. This survey proves that false. Vietnamese salons offer a host of services, including wraps, paraffin dips, gels, pink-andwhites, and even such non-nail services as facials, tanning, and waxing. Salon Services & Pricing* STATISTICS What services are offered in your salon? Service prices Vietnamese Average Industry Average Vietnamese Average Industry Average manicures (basic) 89.3% 97.0% $11.71 $18.23 pedicures (basic) 89.6% 92.0% $21.48 $32.72 full set acrylics (sculpts) 86.0% 71.0% $25.79 $45.77 polish change 83.2% 92.0% $6.43 $8.33 full set acrylics (tips) 80.9% 78.0% $24.77 $41.65 full set (pink-and-whites) 80.8% 72.0% $37.68 $48.03 gels 72.3% 59.0% $35.28 $47.91 eyebrow waxing 63.1% 55.0% N/A N/A *Prices are developed from a survey done in 9/2006. 36 NAILS 2007-2008 THE BIG BOOK NABB08stats_p36-37.qxp 11/5/07 2:12 PM Page 37 What is your title? salon owner 59.6% salon manager 17.2% nail technician 23.2% Gender? female 30% male 70% How many clients do you personally service each week? less than 10 1.7% 10-20 4.9% 21-30 7.3% 31-40 15.1% 41-50 14.5% 51-60 14.8% more than 60 37.3% no response 4.4% How long have you been doing nails? Vietnamese Industry Average Average one year or less 3.4% 18.3% 2-3 years 10.6% 17.4% 4-5 years 16.5% 11.2% 6-7 years 16.5% 7.7% 8-9 years 16.8% 6.2% 10 years or more 36.2% 39.2% Are you responsible for purchasing your own supplies? Yes, I provide all my own supplies, including tools and equipment. 46.5% I provide some supplies, the salon provides some supplies. 9.4% The salon provides all my supplies, except my tools. 35.3% The salon provides all supplies, including tools and equipment. 8.8% ➤ NAILS 2007-2008 THE BIG BOOK 37 NABB08stats_p44-45.qxp 11/5/07 2:12 PM Page 44 Salon Environment How would you describe your salon? Full-service salon 51.2% Nails-only salon 28.6% Day spa 9.0% Home-based salon 4.0% Mobile salon/spa 1.3% Resort/hotel/destination spa/salon 0.2% Other 5.7% How much is your monthly booth rental? STATISTICS $380 (average) $150 or less 13.5% $151-$200 9.7% $201-$250 5.0% $251-$300 19.3% $301-$350 6.7% $351-$400 18.1% $401-$450 2.1% $451-$500 10.9% Do you carry professional liability insurance for yourself or your salon? More than $500 14.7% 54%YES 46%NO Does your salon have a dress code or require a uniform? 38%YES 62%NO How many nail technicians work in this salon? G E F D C A B 44 NAILS 2007-2008 THE BIG BOOK A Just me 49.6% B 2 nail techs 20.3% C 3 techs 12.7% D 4 techs 6.1% E 5 techs 3.7% F 6 techs 2.9% G 7+ techs 4.7% ➤ NA1207opiprofilesfp.ind NABB08stats_p46-47.qxp 11/5/07 3:15 PM Salon Services Page 46 There were fewer shakeups in service offerings this year. 30% of salons say they added a new service, where 11% discontinued a service. Ironically, some of the main services added were also the top services discontinued. Top Nail Salon SERVICE TRENDS 1 Upgrade and upsell. Nail technicians cut back on basic manicure and pedicure services in favor of more deluxe and custom services. You told us about Fire & Ice Pedicures, Stone Pedicures, Peppermint Christmas Manicures, Apple Cinnamon Mani/Pedis, Pomegranate Manicures and Pedicures, Coffee/Tea Pedicures, and Pumpkin Peel Pedicures. On the other hand, a few salons said they discontinued the deluxe services for nearly the same reason. Said one owner, “I have to do more basic services with special prices to compete with other salons.” 2 Foot care diversity. There were lots of new treats for the feet, where the skills once reserved for fingernails were being used to enhance the pedicure service. The most popular new foot service was gel toenails. We heard about the fast-growing popularity of acrylic and gel toenails, especially colored products for an always-pristine pedicure. A good percentage of you tried one of the new “water detoxing” foot treatments, and many have launched medical pedicures. STATISTICS 3 All about color. You’re playing around with colored gels and acrylics and dabbling in 3-D art constructed with liquid-and-powder systems. One of you started adding crushed sea shells to white acrylic, which lets you add $10 for those sets. Another tech imprints pink acrylic with lace for a very pretty, feminine look. You’re custom blending colors to either match your client’s skin tone or her evening dress. One nail technician sums it up: “I’ve added custom acrylic to all my extension services. I base my ideas on the creativity and personality of each of my clients.” 46 NAILS 2007-2008 THE BIG BOOK NABB08stats_p46-47.qxp 4 11/5/07 2:14 PM Page 47 Sanitation forces discontinued services. Many nail techs discontinued their paraffin dips because clients were concerned about dipping into “used” wax. A few others said they discontinued the paraffin dip since it was being offered free anyway or they were eliminating the higher-end manicures and pedicures. 5 Stretching from nail care doesn’t work out… Many salons have decided to do away with non-nail services like ear piercing, body wraps, permanent makeup, facials, and microdermabrasion. “I’m going back to the basics,” one nail technician told us. A few people who had gotten bitten by the tanning bug (including spray tanning) from a few years back threw in the towel. 6 … or it does. Just as many salons that were taking out non-nail services were adding them in. Salons added facials, skin care, eyelash/brow treatments, tanning, permanent makeup, makeup application, waxing, ear candling, massage, and body treatments. 7 Health concerns cause career concerns. For personal reasons, mostly health-related, we saw nail techs dropping gels and acrylics, although most who dropped acrylics say they are focusing on higher-profit natural nail care services instead. 8 Gels are big this year. 23% mentioned adding gel services either as a regular extension service, a gel top coat service, or gel toenails this year. 9 Knowing your clientele opens opportunities. Salons have opened up business opportunities by developing services around a particular client demographic. We heard from salons starting party programs, kids services, temporary nails for teens, and other special-occasion services. A couple of you even added a mobile salon unit. 10 Mini services are big. Whether it’s because clients want things fast or because you want a competitive service, you told us that you’ve added “minis” to the menu like a Mini Mani and Petite Pedi (and a host of other cute service names). ➤ NAILS 2007-2008 THE BIG BOOK 47 NABB08stats_p48-49.qxp 11/5/07 2:22 PM Page 48 Salon Services [Here’s how a few of these services compare to five years ago.] paraffin dips What services are offered in your salon? 97% Pedicures 93% V Polish changes 90% down 22.7% Nail art 78% Full set acrylics (tip-with-overlay) 77% Pink-and-white acrylics 71% Full set acrylics (sculpts) 71% Paraffin dips 70% Waxing (for hair removal) 59% Gels/UV light systems 56% Eyebrow shaping 55% Acrylic toenails 51% UV top coat service 50% Hair care 46% Colored acrylics 45% Skin care 45% Nail jewelry 41% Facials 40% Fiberglass wraps 34% Gel toenails 34% Wraps (silks or linen) 34% Makeup application 33% Massage 33% Colored gels 32% Eyebrow tinting 28% Reflexology 24% Eyelash tinting 22% 19% Powder/glue extensions 19% Eyelash extensions 19% Airbrushing 18% Microdermabrasion treatments (face or body) 16% Ear piercing 13% Tanning 13% Ear coning/candling 12% Microdermabrasion treatments (for hands and feet) 11% Airbrush tanning 10% acrylic toenails up 28.6% fiberglass wraps colored acrylics airbrushing V down 40.4% Wellness treatments or mind-body therapies 6% Permanent makeup 6% V Non-waxing hair removal 5% down 42.0% Non-nail airbrush treatments (e.g. makeup) 4% Nutritional analysis or weight control 3% Water therapies 3% Glamour photography 1% Body piercing 1% 48 NAILS 2007-2008 THE BIG BOOK V Body wraps up 2000% V STATISTICS 2007 Manicures ➤ NABBK07opiavoplexfp NABB08stats_p50-51.qxp 11/5/07 2:26 PM Page 50 Service Prices 2007 2006 Most salons now have a variety of manicure and pedicure services, so that a single “average price” is almost misleading. This year, for the first time, we asked salons for two prices: one for their basic service, one for a “deluxe.” Therefore, the change in service prices over 2006 in this category does not necessarily reflect a drop. Basic manicure $17.53 $18.23 Deluxe manicure $18.70 N/A Basic pedicure $20.80 $32.72 Deluxe pedicure $43.93 N/A Full set acrylics (sculpt) $46.28 $45.77 Full set acrylics (tip-with-overlay) $41.21 $41.65 Gels (full set) $49.09 $47.91 Wraps (full set) $42.66 $42.76 Colored acrylics (full set) $50.72 $48.86 Pink-and-white acrylics (full set) $48.68 $48.03 Acrylic fill $27.63 $24.36 * What products are retailed in your salon?** Nail polish 88% Skin care products 44% Hand lotions 85% Toe rings 38% Nail strengtheners/treatments 83% Boutique items (clothing, jewelry) 33% Top/base coats 81% Makeup/cosmetics 31% Cuticle treatments 77% Adhesives/glue 30% Nail files or buffers 61% Tanning products 21% Hair care 51% Personal implement kits 20% Polish-drying products 45% Vitamins/nutritional supplements 9% 70.1% of nail STATISTICS techs retail products for clients’ at-home use. 42.6% of salons have added at least one new retail item for sale. *Source: 2005 NAILS Big Book **Source: 2006 NAILS Big Book ➤ 50 NAILS 2007-2008 THE BIG BOOK NA1007opispacompltfp NABB08stats_p52-53.qxp 11/5/07 2:33 PM Page 52 Client Demographics Who are your clients?* Girls under 20 5.6% Women 21-25 9.7% Women 26-35 19.4% Women 36-45 28.5% Women 46+ 28.6% Men 8.2% On average, how many clients do you see each week? What would you say is the PERCENTAGE of standing appointments and walk-ins in your business? Standing appointments 68.4% Walk-in appointments 23.2% Other (filling in for another tech, for example) 8.4% 10 or fewer 29.5% 11-20 22.0% 21-30 22.7% 31-40 12.2% 41-50 7.6% More than 50 6.0% 89% What is your busiest day of the week? STATISTICS Saturday of men in Europe and the U.S. consider good grooming and general presentation essential to their professional success. — Changing Male Grooming Behaviors & Occasions (2004), Global Information Inc. 31% of the spa-going population is Day that salons are most frequently closed? Sunday male. — International Spa Association (ISPA) 2006 Spa-goer Study 34.8% of nail techs who have male clients have male-specific services on their menu. — NAILS Magazine (April 2007) *Source: 2006 NAILS Big Book ➤ 52 NAILS 2007-2008 THE BIG BOOK NA0607opicoffeeteafp.i NABB08stats_p54-55.qxp 11/5/07 2:35 PM Page 54 Industry Challenges Building clientele “I’m trying to build a clientele from scratch. It can be hard work to get people of the street into your salon.” What is the biggest challenge that you faced as a nail professional in the last 12 months? Although one nail tech put it succinctly: “I have many challenges and I face each one head on,” most of you had something specific that was vexing you. #1 Competitive market, especially discount salons Customer service (difficult clients, late and no-shows, client retention) “My challenge has been clients that do not show, do not call to cancel...frustrating! I made a nice, polite sign with my rules. It has been great ever since and I find I am getting more respect.” “It’s hard trying to explain to new customers why our prices are more expensive than the budget salons.” #3 #2 Specific product challenges [most often cited: gels, pinkand-whites, lifting] “I’m learning colored acrylics after years of getting used to one type or color of powder.” Finding and retaining personnel Keeping up with trends, new products, industry issues “Staffing is a major challenge. With so many high volume shops, it is hard to compete in the peak seasons.” “Keeping up with the latest products and having them available is a big challenge for me. #4 #6 #5 A slumping economy, including seasonal slowdowns Opening a new salon STATISTICS “The economy hasn’t really been good for me since March 2007. Most of my customers are complaining about high electric bills and gas prices.” “I’m opening my own salon and frantic getting it finished in time for opening and dealing with the landlord and upstairs tenants.” #8 #7 Personal time management Finding classes “It’s hard finding continuing education classes in my area.” 54 NAILS 2007-2008 THE BIG BOOK #9 “I always get very busy in the spring with people wanting pedicures, and I can’t get everyone in since I can’t physically do that many a day. #10 NABB08stats_p54-55.qxp 11/5/07 2:35 PM Page 55 Have you advertised your business in the last 12 months? Business Building yes 66.4% no 31.4% Where have you advertised your business in the last 12 months?* Local newspaper 51.5% Client referral system 49.4% Yellow Pages (printed) 37.5% The salon has its own website 34.4% Direct mail to local area residents 26.8% Sponsor charity events 24.9% High school or other school papers 23.0% Other online directories (including salon finder sites) 20.2% Online Yellow Pages 18.8% Door hangers or windshield flyers 18.7% I have a MySpace page 18.0% Local or city magazines 17.6% Cooperative advertising with other local businesses 11.1% Radio 9.7% Sponsor local sports teams 8.3% Local TV 5.7% Billboards or bus benches 4.3% I have a Facebook page 3.8% Other 14.0% How tech-savvy are nail salons?* I go online to chat with other nail technicians. 29.1% I go online to order products. 78.1% I look at nail-related videos online. 53.9% I spend less than five hours a week online. 29.1% I spend 5-10 hours per week on online. 42.4% I spend 11-20 hours a week online. 22.7% I spend more than 20 hours a week online. 18.3% I subscribe to various nail-related e-mail newsletters. 74.9% I’m interested in receiving information about nail products via e-mail. 86.6% E-mail is a good way to reach me. 93.4% *Note: Figures don’t add up to 100% as respondents were asked to check all that apply. ➤ NAILS 2007-2008 THE BIG BOOK 55 NABB08stats_p60-61.qxp 11/5/07 2:36 PM Page 60 Buying Habits How much do you spend per month on nail supplies? Less than $100 per month 28.4% $101-$150 per month 29.3% $151-$200 per month 15.0% $201-$250 per month 4.3% $251-$300 per month 8.7% $301-$350 per month 1.6% Where do you shop for nail supplies?* More than $350 per month 12.7% Do you purchase your own nail products? Yes, I provide all my own supplies, including tools and equipment. 70.2% I shop in a professional beauty supply store. 90.9% I order over the phone from my dealer’s catalog or deal sheets. 40.1% I buy products at tradeshows. 39.4% I order online from my dealer’s catalog. 36.7% I buy direct from the manufacturer. 31.6% I order from an online-only distributor. 30.5% I shop in an open-to-the-public beauty store. 24.6% A distributor’s sales consultant comes to the salon and takes my order. 22.9% For some items, I buy from non-traditional places that don’t carry traditional professional nail supplies. 12.9% I shop at the drugstore or other general store. 6.6% I shop from a mobile or van dealer who comes to my salon. 2.1% Other 2.8% *Note: Figures do not add up to 100% as respondents were asked to check all that apply. STATISTICS I provide some supplies, the salon provides some supplies. The salon provides all my supplies, except my tools. 8.8% How often do you purchase supplies? 12.5% E The salon provides all supplies, including tools and equipment. D A 8.5% C B 60 NAILS 2007-2008 THE BIG BOOK A Less than once a month B 15.7% Once a month 40.5% C Twice a month 30.0% D Once a week 12.6% E More than once a week 1.2% NABB08stats_p60-61.qxp 11/5/07 2:37 PM Page 61 Nail Tech Income Which best describes your compensation system? A H I am a booth renter, I pay rent to the salon and I keep all my service fees. I am a booth renter, I pay rent to the salon and I keep a percentage of my service fees. I am an employee and I receive a salary. I am an employee and I receive a salary plus a percentage of my service fees. I am an employee and I receive just a percentage of my service fees. I am an employee and my compensation is based on the number of clients I serve. (I receive a higher commission if I bring in more clients.) 38.0% 3.5% of nail techs receive a commission or other incentive for selling retail products. D F 20.0% E 7.2% Average weekly income* 24.5% 6.8% 55.7% (average)* 49.5% C G What commission percentage do you receive on services? Supplemental income: B A $150 or less 10.8% B $151-$250 11.1% C $251-$350 11.6% D $351-$450 10.9% E $451-$550 12.6% F $551-$650 10.0% G $651-$750 6.8% H More than $750 26.2% On average, how many HOURS do you work each week? 10 or fewer 15.4% 11-20 14.3% 21-30 21.6% 31-40 26.6% 41-50 15.7% More than 50 6.4% *Source: 2006 NAILS Big Book ➤ NAILS 2007-2008 THE BIG BOOK 61 NABB08stats_p62-63.qxp 11/5/07 3:00 PM Page 62 Regional Analysis nail techs STATISTICS 2007 Alabama Alaska Arizona Arkansas California Colorado Connecticut Delaware Dist. of Columbia Florida Georgia Hawaii Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming U.S. Totals 62 NAILS 2007-2008 THE BIG BOOK 1,933 356 8,332 1,438 83,343 6,901 2,700 415 186 45,599 5,208 1,500 1,354 8,380 3,069 899 925 2,098 3,029 761 6,400 11,194 12,214 2,732 1,814 4,910 475 809 5,400 911 8,155 1,182 16,500 6,774 112 11,893 4,531 15,024 9,176 1,467 1,961 36 3,854 24,157 1,930 201 5,833 7,100 618 1,734 375 347,898 2006 1,587 366 8,531 1,485 79,582 6,301 2,800 450 750 38,452 5,299 1,800 1,174 8,577 3,168 700 900 2,134 1,260 786 6,170 10,499 12,355 2,816 1,871 4,310 483 831 5,100 939 7,995 1,215 16,000 6,922 113 12,096 4,645 15,266 9,308 1,192 2,017 30 5,915 24,578 1,922 208 6,002 7,000 500 1,696 395 361,427 nail salons 2007 802 120 1,122 450 8,240 901 931 182 89 4,204 2,000 213 241 2,223 874 336 447 566 895 187 995 1,421 1,658 661 434 944 174 295 490 210 2,603 356 4,103 1,736 66 1,684 649 631 2,654 214 737 59 1,025 5,103 340 63 1,464 1,286 173 970 109 58,330 2006 764 123 1,023 430 8,112 899 913 178 83 4,107 1,939 206 222 2,250 860 320 445 534 836 185 980 1,470 1,670 645 433 928 168 297 449 217 2,597 348 3,790 1,714 64 1,725 602 628 2,696 201 687 57 972 5,102 336 59 1,411 1,179 173 975 107 59,843