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Private Labels in Salons

July 23, 2012

Although private label and salon brands have been around for quite some time over the last few years they have been proliferating. Small and average salons around the country are embarking on the private label bandwagon with widely mixed results.

Pros
1. Grants better margins
2. Promotes your salon every single day of at-home usage
3. Offers flexibility in packaging and labeling
4. Can evolve into a profitable wholesale business
5. Provides the opportunity to select and restrict specific ingredients

Cons
1. Requires a great deal of time and money
2. Involves a chemist, a laboratory, a factory, graphic artists, and testing volunteers
3. Most ‘ready to label’ programs present out-dated technology or me-too products
4. Demands a sizeable inventory to get cost advantage
5. Requires you to invest in promotion, education and sales collateral

In short, only enter the self-formulation private label game if you are at least a 15+ service provider salon, a chain operation or a franchise system. For the independent salon, if you feel compelled to embark on this venture, limit yourself to branding a select few pre-formulated products and keep your exposure low.

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