How To Combat Rising Costs Following National Budget Cuts
How To Combat Rising Costs Following National Budget Cuts
With years of industry insight, Edward James shares strategies to help salons adapt and thrive amid economic changes
by C | INFORM
In response to the recent national budget changes, Edward James has openly voiced his frustrations over what he sees as damaging policies for the hairdressing industry. For salon owners like himself, these changes—including the reduction of business rates relief from 75 per cent to 40 per cent and the increase in National Insurance—pose serious challenges. He explains: “The reduced business rates relief, coupled with increased National Insurance, disproportionately impacts our industry – one that relies heavily on staffing and operates in a service-based economy.”
As a highly respected figure in the hairdressing industry with over 25 years of experience, Edward James has built a name for himself not only as a top stylist but as a champion of sustainable and client-centred salon practices. Known for his luxury Edward James Salon & Spa locations across South London, Edward has won numerous awards, garnered a loyal clientele, and fostered an elite team that embodies his values of quality and community.
Edward is well-positioned to critique these policies, having grown his business from a one-person operation to an award-winning network of salons employing over 100 people. He has dedicated his career to creating not only beautiful spaces but also stable employment for his team and a haven for clients. His insights into the impact of budget cuts extend beyond personal grievance; they reflect a deep understanding of the broader economic and community repercussions. “These aren’t just numbers – they’re people’s livelihoods, career opportunities, and local jobs that contribute to the economy,” he says.
“”With high streets increasingly dominated by service-oriented businesses like salons, Edward believes the budget’s approach is out of touch with modern economic realities. Salons face substantial overheads, with 60 per cent of their operating costs typically going toward staffing, an unavoidable expense in a hands-on, client-focused industry. As Edward points out: “Salons require a significant workforce to provide personal services, meaning we’re facing substantial overheads on staffing alone.”
Reflecting on his personal sacrifices, Edward shares: “I’ve dedicated 14 years of relentless work to this business, which challenges Keir Starmer’s perception of what a ‘working person’ entails. Business owners frequently work harder than anyone within the company, carrying significant responsibility. During the pandemic, our salons were forced to close for a total of 245 days, resulting in considerable team losses. Selling my home was essential to keep the business afloat, prevent closures, and avoid redundancies. My belief in our team’s resilience drove this decision, as I trusted we’d recover.”
Edward emphasises his ongoing commitment to reinvest in his business, manage debt carefully and develop career paths for his employees. “Our growth strategy – from a single salon to four locations – allows us to create more support roles, expand educational offerings and provide a better work-life balance, such as alternate weekends off and four-day work weeks,” he explains.
The new budget, he warns, could undermine such resilience, potentially forcing salons like his to cut jobs, reduce hours or even close locations. “With the reduction in business rates relief, I now face difficult choices: cutting jobs, reducing hours, and potentially closing one of our salons in Southwest London,” he notes, highlighting the tough decisions facing many in the industry.
“We are considering relocating one of our salons to a destination with reduced rent and rates, as well as exploring mobile services and self-employment options. However, I’m deeply committed to maintaining a cohesive team atmosphere, which I believe is lost with a fully self-employed model.”
Edward urges the government to reconsider these budget changes, warning of the ripple effects that could stifle a vital sector of local economies. “A thriving hairdressing sector is essential to maintaining vibrant high streets and providing stable employment, especially in times of economic change,” he says.
“We are exploring every option to uphold the high standards that define our brand. If our current structure becomes unsustainable, we may need to adjust hours, impacting client flexibility as well as our team’s,” he adds, acknowledging the difficult balance between meeting client expectations and maintaining quality.
Edward says, “Collective advocacy is crucial. Salons often get grouped with the broader ‘beauty sector,’ which is experiencing growth. Unfortunately, this masks the challenges salons face. Retail beauty operates with a smaller workforce, so employment taxes have less impact, and many products are sold online, avoiding the substantial burden of business rates. Hair salons, however, remain high-cost, high-commitment ventures that require fairer treatment to survive.”
In the meantime, he has stepped up to support other salon owners facing similar financial strains, offering his advice and strategies to help them remain resilient. His key recommendations include:
- Review Costs Regularly: Take a thorough look at monthly expenses to identify any non-essential costs that can be cut. Negotiate with suppliers to lower costs wherever possible, and reassess each expense line item.
- Optimise Operating Hours: Analyse customer traffic data to focus on high-demand periods. Consider reducing hours on quieter days to save on both energy and labour costs.
- Streamline Staff Schedules: Use scheduling software or data analysis to align staff levels with client demand, maximising productivity and avoiding unnecessary labour costs.
- Consider Self-Employment Models: If suitable for your salon, explore moving stylists to a self-employed model. This approach can relieve some of the tax burden associated with National Insurance increases, while also providing stylists with greater flexibility.
- Join Support Organisations: Connect with industry groups such as the Federation of Small Businesses (FSB) and the Salon Employers Association (SEA). These groups provide valuable resources, a supportive community, and a collective voice for advocating industry-friendly policies.
Edward’s advice offers a lifeline for salon owners determined to face these turbulent times with resilience and adaptability. For an industry that’s always been about creativity, connection and making clients feel extraordinary, these changes hit close to the bone. But with leaders like Edward, the hairdressing community is reminded of the power of unity and shared solutions. Together, with a focus on smarter strategies and mutual support, the industry can stand strong, protecting not just jobs but the heartbeat of the high street.
