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NHBF report warns of bleak future for UK hairdressing without government intervention

Damning report on the future for hair and beauty further reinforces urgent measures are required to ensure the majority of the industry survives

‘Hair, beauty and the pandemic: An industry at the sharp end’ is the latest report to be released from the NHBF. Commissioned from independent analysts Pragmatix Advisory by the NHBF, it details the current situation for the industry, as well as the strength of the sector prior to the pandemic. The report highlights the impact of Covid-19 on business vulnerability and the potential for mitigating measures.

Evidence from the report shows that hairdressing has been one of the worst affected sectors, with more than 140 days of lockdown in 2020. On average, turnover fell by 45 per cent compared to 2019. Social distancing restrictions mean salon capacity is down to 70 per cent of what it was. As a result, salons are losing on average two hours of appointment time per stylist per day. There are also reports of reduced customer demand.

The average cash loss to a business in 2020 was £17,000, with those over the VAT threshold taking a bigger hit. Furthermore, 60 per cent of businesses entered 2021 with no cash reserves, up from 27 per cent in 2019. Without further support, most businesses expect to survive two to three months (from January) if lockdown continues.

NHBF infographic

NHBF infographic

However, the report identifies that reducing VAT to five per cent would add £16,000 to the average VAT registered business. In turn, this would  close the cash gap by one-third. The urgent measures required will ensure that the majority of the industry survives, which long term will cost the Government very little. To find out how you can call on your MP to #SaveOurSalons, click here. 

Richard Lambert, NHBF chief executive says: “While the future could be bleak, intervention now and immediately following re-opening will have a life-changing positive effect.”

“There’s nothing coming in, but the overheads still have to be paid. When we are closed, we are closed.  We can’t diversify into takeaways and online sales. The Personal Care sector is calling for a specific grant to support businesses through the immediate cashflow crisis, in line with similar funds that have been afforded to many other sectors.”

“Right now, it feels like we are last in line for support. We are overlooked by Government, despite the billions of pounds we contribute to the economy each year,” he adds.

The NHBF, along with the British Beauty Council, British Association of Beauty Therapists and Cosmetologists and UK Spa Association, has been lobbying the Department for Business, the Treasury and the Cabinet Office for an urgent Personal Care crisis fund and a reduction in VAT.

To read the report in full, click here.