How do you calculate the price of a hair service?
A price that is too low rarely shows straight away: the diary is full, clients are happy, but at the end of the month almost nothing is left. A price that is too high shows faster: empty slots. The cost-per-minute method finds the right price for your salon, with your costs.
All figures in this guide are worked examples. Redo them with your own numbers: a sheet of paper or a spreadsheet is enough.
Step 1: add up all your monthly costs
List everything the salon costs in a month, even if nobody works. Take the invented example of “Lumière Hair”, with the owner and one employed stylist:
| Monthly cost | Example |
|---|---|
| Rent and service charge | £1,200 |
| Business rates (after any relief) | £150 |
| Employed stylist, including employer costs | £2,300 |
| Owner’s target pay | £2,400 |
| Energy and water | £320 |
| Insurance, bank fees, card reader | £160 |
| Accountant | £120 |
| Software, phone, internet | £100 |
| Towels, small equipment, cleaning | £150 |
| Loan repayment | £400 |
| Total | £7,300 |
Two common traps: forgetting your own pay (“I pay myself with what is left”) and forgetting yearly costs (insurance paid once a year, equipment replacement). Divide them by 12 and add them to the month.
Technical products (colour, developer, treatments) are not in this table: you add them service by service, because a colour uses far more than a men’s cut.
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Step 2: count the minutes you actually sell
Do not divide costs by opening hours, but by the minutes when a stylist is working on a paying client. The rest (reception, cleaning, ordering, gaps in the diary) is real, but it is not sold: it has to be paid for by the minutes that are.
In the example, two people work 35 hours a week, 46 weeks a year (holidays and training removed):
- Hours present per person per month: 35 × 46 ÷ 12 ≈ 134 hours
- Realistic occupancy: 70% (a diary is never 100% full)
- Hours sold per person: 134 × 0.70 ≈ 94 hours, or 5,640 minutes
- For both: 11,280 minutes sold per month
Step 3: work out your cost per minute
Cost per minute = monthly costs ÷ minutes sold.
In the example: £7,300 ÷ 11,280 minutes ≈ £0.65 per minute, about £39 per hour sold.
This is your floor: below it, every minute worked loses money. It changes when occupancy changes: at 80% instead of 70%, the same costs give £7,300 ÷ 12,880 ≈ £0.57 per minute. Filling the diary lowers your cost without touching prices.
| Occupancy | Minutes sold (2 people) | Example cost per minute |
|---|---|---|
| 50% | 8,050 | £0.91 |
| 60% | 9,660 | £0.76 |
| 70% | 11,280 | £0.65 |
| 80% | 12,880 | £0.57 |
Step 4: price each service, with examples
Price before VAT = (time × cost per minute) + products + margin. If you are VAT-registered, add 20% VAT on top.
The margin (calculations of this kind often use 10 to 20%, the choice is yours) pays for investment, a quiet month and a reserve. In the example we use 15% and a cost per minute of £0.65.
| Service | Time | Time × £0.65 | Products | +15% | Price |
|---|---|---|---|---|---|
| Men’s cut | 30 min | £19.50 | £0.50 | £3.00 | £23.00 |
| Wash, cut and blow-dry | 60 min | £39.00 | £2.00 | £6.15 | £47.15 |
| Root colour and blow-dry | 90 min | £58.50 | £7.00 | £9.83 | £75.33 |
| Balayage, cut and blow-dry | 150 min | £97.50 | £13.00 | £16.58 | £127.08 |
| Beard trim | 20 min | £13.00 | £0.50 | £2.03 | £15.53 |
Then round to a clear price (£23, £47, £75…). If you are VAT-registered, these become £27.60, £56.58 and so on before rounding. Times include development time: while a colour develops, the stylist can do a men’s cut. If that often happens in your salon, you can count only the “active” time on colour services and be more competitive.
VAT
You must register for VAT when your taxable turnover goes over £90,000 in the last 12 months, or is expected to in the next 30 days (GOV.UK). If you are close, build VAT into your price plan now: adding 20% overnight is much harder than planning for it.
Step 5: compare with local salons and adjust
The calculation gives your floor price. Now compare it with nearby salons: their prices are usually at reception and online. Note the 5 or 6 main services of 4 or 5 salons.
- Your calculated price is close to the local average: fine, round it and align
- It is clearly above: look where to act. Time (a cut in 45 minutes rather than 60?), occupancy (empty Tuesday slots?), a heavy cost? Or own a more premium position, with service that backs it up
- It is clearly below: you may be leaving money on the table. A well-rated salon with many reviews can sit slightly above the area
What justifies a higher price to clients: a proper consultation, consistent results, a pleasant salon, recent and numerous reviews. A 4.8 rating with 150 reviews reassures more than a low price. Our guide to Google reviews for hair salons shows how to get there.
Packages, long hair and short services: good practice
Packages
A package (“colour, cut and blow-dry”) makes choosing easier. Price it as the sum of the services, then give a small discount if you wish, and say clearly what is included.
Long or thick hair: plan a supplement
Colour on very long hair uses twice the product and time. Rather than one price, show a “short / medium” price and a clear supplement for long hair. Clients know what to expect before they sit down.
Price by service, not by person
Base prices on the time and products of the service rather than on who the client is: a 30-minute short cut takes the same time whoever is in the chair. More and more salons now price by length and technique, which is fairer and easier to read.
Very short services
A fringe trim takes 10 minutes but often blocks a 15 to 20-minute slot. Set a minimum price that reflects the slot.
The 6 most common pricing mistakes in salons
- Copying the salon next door without doing your own sums: their rent, costs and team are not yours.
- Forgetting your own pay: a salon that only “ticks over” without paying its owner is not profitable, it is being subsidised by the owner.
- Underestimating time: time your services for two weeks. The gap with the “theoretical” time often surprises.
- Giving away too many small extras: free treatment, free fringe trim, free mask… Each free gesture costs product and minutes.
- Never raising prices: costs rise every year, prices must follow in small steps.
- Showing “from” prices that are too low: the client discovers a very different final bill and feels tricked. Prefer prices by hair length, clear from the start.
When and how to review your prices
Redo the calculation at least once a year, and whenever a big cost changes: rent review, a new hire, a supplier price rise. A small regular increase goes down far better than a big one after three years of standing still.
- Tell clients at least a month ahead, with a notice at reception and a message
- Explain without over-justifying: one sentence is enough
- Update reception, your website and online booking at the same time
Dear clients, from [date] our prices will change slightly to keep up with rising costs and keep using quality products. The new prices are at reception and online. Thank you for your loyalty, the whole team at [Salon name].
For more wording and the right timing, see our guide to announcing a price increase. With Voxtya online booking, the price and length of each service are changed once and shown to clients when they book.
The steps at a glance
The cost-per-minute method in five steps.
- Add up monthly costs. Rent, rates, wages, your own pay, energy, insurance, accountant, loan, yearly costs divided by 12.
- Count minutes sold. Hours present × realistic occupancy, in minutes.
- Work out cost per minute. Monthly costs divided by minutes sold.
- Price each service. Time × cost per minute + products + margin, then VAT if registered.
- Compare and adjust. Local prices, rounding, and a review at least once a year.
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Sources
The rules quoted in this guide come from these official pages, checked on October 28, 2026.