Hair Care is a $55 billion+ industry in the US. It is also akin to the restaurant business in that it is highly recession resistant, and is almost always a guaranteed source of revenue if it reaches out to a good demographic.
I have a strange aversion to female hair dressers/stylists because of one bad experience. Nevertheless, I decided to give the new neighborhood Great Clips a shot because they were offering a haircut for $7. Now, each Great Clips franchise is independently run and offers the same kind of ambience. Every store maintains a list of names and addresses of their customers. This is not shared among the different locations, and I am guessing serves to maintain the spending/services received profile of every customer at a location.
In addition to regular hair care services, the company has also forged “strategic” alliances with product companies that market different hair care products for both men and women. And, what better way to reach out to potenial customers than to offer them a free trial of a shampoo or hair thickening lotion! I was offered a free shampoo as soon as I sat in one of the chairs.
Another thing I noticed was that my stylist was actually certified by Great Clips as a qualified hair stylist. This is something I have never seen before, at least at any run of the mill cheap salon. I was fairly impressed, and discussed hair care with her. She recommended me a particular shampoo and hair lotion, and even offered to give me a free trial of the lotion.
In the end, I walked out of the salon spending more than what I expected to, and wondering about how, for the first time, I actually enjoyed being a customer at a chain than an independent establishment. I am pretty impressed with the way American chains work. They are able to capitalize on a brand name with so much efficiency. This also made me wonder if there was anything similar back home in India. All I could come across in my search was a fairly new company called Brushman (India) Limited. I am not sure about the size of the hair care industry in India, but with such a large population, I am guessing it is pretty big. Now, it’s another thing that the biggest chunk of that industry rests with small little roadside barbershops offering hair cuts for a dollar.
2 replies on “My Great Clips experience”
I would’nt agree that the restaurant business is recession-resistant – I think the food business is, but if people dont have money, they would eat at home instead of eating out.
sI think it’s a good question that needs to be explored. Statistically, all the restaurant industry stocks have performed very well even when the American economy was reeling under the effect of the dot-com crash and/or the somewhat recessive nature of the economy earlier this decade. Now, it is also true that most of the restaurant stocks are very well restaurant chain stocks with a very economical menu, generally. Current market pricing dictates that the price difference between eating at home using top quality ingredients and eating at a chain isn’t a lot or even considerable. Besides, in a family, you always have children and other intrinsic factors that make eating out usually the last monetary sacrifice in times of economic hardship. If you look at the stock performance, restaurant stocks in general have always been a secure way to invest your money.
And it’s not very surprising, but alcohol stocks actually go up during recession. Restaurants make money serving alcohol.
If anything, I think the niche/upclass/specialised restaurants face more hardships during economic downturns.