Updated: May 26, 2022
Back in 2013, we evolve a hair business that started as a side-hustle from a $500 USD start-up capital into a $2 million USD revenue per year, with a full-time staff of 40 and 4 physical stores further to 300 000 followers across social media.
After this level of noticeable success, a number of brands in hair and beauty across Africa, Canada, India, US etc approached us, wanting the same success story for themselves. Among the enquiries we received was an overwhelming amount of mostly women with corporate jobs wanting a second income, influencers wanting to start their own hair brands, people who have existing salons and haircare product lines and distributors, students and independent hair stylists and celebrity beauticians.
We realised that we needed to build solutions that can deliver the same success at scale. I will share a link with examples to what my team did previously, along these lines.
Just off the cuff, I want to share with you 3 things you need to build a thriving hair business. You will be surprised how super helpful these are, although they sound quite basic, the success is in the details. If followed diligently, these guidelines may enable you to achieve the success on your own, without any input. Think of them as quack DIY tips, to lay the foundations, to your hair business success.
My aim is to help you with pointers of where to start. It often saddens me that sometimes people in the industry are very hesitant to share their experience in order to help others, and are often quite secretive.
So here we are: as easy as ABC :) ok not so easy but very important and quite doable.
Administration: pay attention to details and formalise things from the beginning·
Brand your Business very well: and position it for success from the beginning
Capital: even the biggest of businesses were once small, be willing to start small
01. Administration — pay close attention to details and formalise things from the beginning
It doesn’t matter whether you want to run your business as a side-hustle for extra income or be hands on it full-time, formalities matter, a lot more than you realise. No matter how big or small you want to grow, be sure to formalise your business from the very beginning.
I have often insisted to every business owner or would-be business owner, in the hair industry that they must build with the end in mind. See the big picture of where this could go, then retrace your steps, to find the way to get there.
By doing that, it will soon become clear, why details, and what may appear to be boring formalities, are actually important, and must all be in place from the start. Here’s an example: the business we evolved on behalf of the client from $500 USD to $2 million USD, my team did so, with the big picture in mind i.e. If we were going to evolve that business into something, that “thing” had a name.
Our aim was to either evolve and grow it to a position where it could be sellable for at least $4 million USD in 3 years.
Secondly, if not up for sale, then at least the business must be able to become a respectable franchise model that people want to buy into.
Third option: raise more money from investors, to reinforce the business into becoming a dominant go-to brand.
Hence it was important for me and my team to take that hair venture very seriously, from the word go. Still wondering if you should put systems in place from the beginning? Such as incorporating your business to become a legal entity i.e. basic things such as company registration, business account, website etc are a must, further to keeping your books, and paying taxes.
In concluding this point, just ask yourself: are you starting this business, as just a hobby, or to later bring interested investors on board (they will ask for the paperwork), or turn it into a household name among existing franchises? Your answer to this question, will make it quite clear why paperwork, from the beginning is actually not a wasted effort at all, but a worthwhile investment on your part.
02: Brand your Business very well
Remember hair is a lifestyle business. Think of it that way, you will see why in a moment. Do a little mental experiment right now. Try and think of most of the lifestyle products that cost upwards of $100 dollars. You may quickly start thinking of what a $100 dollars could buy you. Let’s see, perhaps: a smartphone, a pair of sneaker, a champagne bottle, good quality shoes, a nice handbag, a luxury fragrance, handcrafted chocolates, a dress, some jewellery, etc.
How do you feel about spending that $100 dollars on a no-name or non-branded cheap looking item, which is just tossed into a cheap looking plastic bag, in a questionable location?
You will be surprised how often I have seen that sort of thing, happening, in the salon industry. Just because you are entering a hair business landscape, it does not mean you should drop the ball or lower your guard.
Here’s a true story, that actually happened to me. One Friday afternoon a while ago, long before I became involved in the hair sector, I was on my way to a product launch, hosted by one of our clients. I needed a new human hair wig for the event. I placed the order at a salon on Monday, to pick it up at the end of the week, because they did not have it in stock at the time, they took my order, and placed my request on the queue of wigs to be picked up that same week.
The salon manager called me on Wednesday to come and collect it, as it was ready sooner. Although I lived down the road, I could not pick up the wig, because I got very busy that week building up to the launch, I told them I will pick it up Friday afternoon.
On my way to the salon, after doing my make up I passed by a Belgian chocolate gift store, which was located just a floor above the salon, inside the same mall, Sandton City. I ordered and picked up a number of chocolate boxes as a giveaway to our guests at the business launch.
I was so excited when I saw how each of the chocolate gift box, was especially packaged, complete with a special ribbon around each chocolate gift box.
The packaging was super impressive, done with such flair and class. Simply put, I was quite content with the purchase, with was absolutely simply adorable, thoughtful and outright gorgeous. So I paid for the chocolate boxes, asked for some gift bags, with them, and made my way to go downstairs, with anticipation, quite excited to pick up my new wig.
My afternoon was just ruined, as my joy was simply deflated and utterly ruined, when they handed me my new wig. To be fair, there was nothing wrong with the hair itself. It was actually good quality. It was customised just the way I wanted. But it was packaged inside a navy thin and cheap looking plastic. The type of cheap plastic you get when you buy things at some dingy cheap bargain place, like maybe a wholesale bargain hunting place, such as shops inside a “china mall”.
At that point, I asked the store manager to call the owner who was onsite at the salon, but in the back office. I asked her “Can you help me understand this. Just upstairs, I spent $100 dollars on 4 boxes filled with luxury hand crafted chocolate. How is it that the chocolatier paid so much attention to packaging these four chocolate boxes, that are each worth so little compared to what I am paying for this wig?” I paused to contain myself.
Then continued, quite politely, “I spent $450 dollars on this wig. But how is it that you or your staff, decided that it be dumped into this cheap plastic, and handed to me, just like that” Guess what she did at that moment?
She just shrugged and proceeded to ask me
“My sister, is there something wrong with the hair?” It was at that moment, that I realised that: I will never get her to understand the gravity of the situation, or that this is a lifestyle product she is selling, not just hair. Here’s the thing: people do not buy from brands or salon outlets, for the sake of buying products in and of themselves. People are looking for customer experience.
Consumers, spending at this level, expect your lifestyle product, to fit neatly next to their other lifestyle items, not stand out for the wrong reasons, like a black sheep product. If I spend $450 dollars, can I at least get a decent pretty looking box and a bit of a smile and a thank you for goodness sake! Fair expectation, from me? You tell me. I think that was fair, given I did not shout it out, but spoke to her gently, on the side, away from prying eyes, and away from ear shot of other customers.
As I am writing this that same salon has closed down. While other salon brands that were open before or after it, are still continuing to sell their hair online and have kept growing, despite market difficulties.
Why is? Because consumer expectations, are exceeded.
Ok I will take time through another article to talk about branding your hair brand in more details, just remember to be on the lookout. For now I just wanted to touch on this aspect, that your image matters, the look and feel of your business matters, hygiene really matters, customer experience matter, and yes, making your customers feel special and a little more pampered during each wig collection, matters more than you realise.
03: Capital — even the biggest of businesses were once small, be willing to start small
Can you believe it, over 24 million women across Africa buy human hair extensions every year. Each woman spending on an average of $290 dollars, for one look or wig. Every year in total African women buy hair to the value of $7 Billion dollars.
So if you’re wondering if this is worth your time or money, just take a guess! Outside of the US, Africa is the second largest market globally when it comes to human hair extension consumption. Surprisingly though, less than 10% of the money made in Africa’s hair industry ends up in the hands of other African women.
We as African women, seem to be super content, with just being consumers or the items we buy, not just hair, but many other items. We simply take the back seat and appear to be more than happy to just be consumers, not owners or producers. My dream is for African women to claim more stake from that $7 billion dollars. We are already consumers, so why not own it.
I know I’ve just mentioned big numbers, you may have not expected at the beginning of this read, with only 3 tips.
The reality is: the hair business is one of the most lucrative businesses you can start with very little capital compared to the returns you stand to gain, if done right.
Really think about it, how many investment opportunities or options available to you right now, that could move you from $500 dollars to $2 million dollars, in just 36 months, when done right and then create jobs for many other people!
So, yes, the point is, by all means: do start small but start well from the word go. Starting small helps you to minimise the risk while you create a healthy track-record on your path to creating a second income, or a wealth making pipeline for your family through this business. A business that is run well, with a healthy cash flow, is an asset you will be glad to have created, in the long run. Just make sure, the business remains healthy, and you never lose sight of why you begun this journey in the first place.
Taking care of your customers even when you grow, is key.
Most people think of a typical hair business as just one of those things, you do without taking them seriously. But given that there’s billions exchanging hands, we ought to sit up and take careful notice. After all, why is it that whilst African women are wondering how to pay their monthly bills, people that do not even wear weaves are making millions from this industry, of an item that you are probably wearing, right now as you read this?
I hope to receive great news from you in my mailbox, one of these days, telling me that you have taken this advice quite seriously and are already on your way to your first million. Do not chicken out, if you have that desire to start your own million dollar business, take that first step.
If you are not feeling confident to go the distance alone, drop me a message, I will ask my team to look at your dream, and see if they could assist you via a handful of proven consulting inputs. After all, the most successful of hair bosses, hardly go the journey alone.
Ok as promised, here is the link to some of the solutions my team has executed for others, it might inspire clarity as you finalise your own hair journey.
And yes: feel free to reach out, they will gladly consider helping you, on your hair journey.
Speak to you soon, cheers.
My business experiences date back to my days in the village, where from the age of 6 I worked in my family’s business. My father owned a car repair workshop and wood cutting businesses. Prior to co-founding Coronet Blockchain in 2019, I had been involved in management consulting, specialising in access to new markets.
Key highlights include scaling a new business from 500 USD to 2 million USD within 36 months. We then received two funding tranches from a US multinational, to build Coronet, a tailored blockchain enabled supply chain solution to disrupt Africa’s supply chains, starting with the hair extensions.
Our vision leading to 2030: covers the top 3 BFFs: Beauty, Fashion and Food, supply chains. Leveraging tech, for social good across 9 Sustainable Development Goals (SDGs)
Coronet Blockchain is a B2B2C Marketplace that provides blockchain vetted human hair extensions, haircare products & salon equipment to African salons, distributors & retailers from ethical global manufacturers at lower sourcing costs. We securely track human hair pieces from Source to Customer: 100% human hair requires 100% secure tracking.
Coronet Blockchain was founded in 2019. Our first use case involves using blockchain to transform Africa’s 7 billion USD hair extensions sector. Our SDG2030 BFF focus, is using blockchain across Beauty, Fashion & Food supply chains., leveraging blockchain, for social good. Impacting Africa’s supply chains. We also assist entities & governments in their own blockchain journeys, with consulting insights.
Here’s one of the brands we created, for your reference: https://www.iconiquewigs.com/
You can reach me on this email should require our input: firstname.lastname@example.org