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4 April 2014 | beautystorebusiness.com Marc Birenbaum Executive Editor mbirenbaum@creativeage.com Editor's Note CYRUS BULSARA, PRESIDENT OF Dallas-based Professional Consultants & Resources—the leading salon-industry data source and strategic consultants— has released his company's 2013 Profes- sional Salon Industry Haircare Study. His conclusions: The weak economy led to low growth for salon products and services. His big-picture statistics: Professional- beauty haircare products grew at 2.8%, and overall sales of salon-industry products— hair care, nail care and skin care—were up a sluggish 2.7%. The other major statistics from his latest study: The total U.S. salon haircare market segment—retail plus services—registered $64.8 billion, repre- senting just 2.3% growth. And there are nearly 301,000 salons and barbershops now using and selling haircare products in the United States. "The state of our salon industry is weak and rapidly changing," says Bulsara. "Major national macroeconomic factors impacting the salon industry include gener- ally lower disposable incomes, high real unemployment, government regulations slowing expansion, wage and job uncertainty created by national health care, and the U.S. Fed and fiscal policy. Haircare prod- uct sales, such as shampoos, conditioners, hair sprays, hairstyling and specialty prod- ucts, are being hurt by the dynamic shift toward family-economy chains and chair/ suite rentals, which do not sell products effectively. The only bright spot is hair- coloring services with a 3.7% growth due to an aging population and the desire for fashion hair color. Keratin and straightening services also grew at about 3.5%. Cutting and styling services grew by less than 2%. Nailcare services also grew at a lower rate of 7.5% due to the weak economy." Some of the many takeaways for me from his study include: • Sally Beauty Supply store sales were flat due to lower disposable incomes and, consequently, lower sales to both salons and consumers. • "C"- and "D"-class chair/suite rental salons and consumers shop at SBS. • Mega salon store ULTA Beauty grew by more than 20% primarily due to salon products sold at deep discounts com- bined with special offers. • As for the two nationwide salon- products distributors, Beauty Systems Group sales grew 5.1%, while L'Oréal's SalonCentric declined 2.7%. • High-end, independent salons plus "A"- and "B"-class chair/suite rentals drove full-service sales at BSG/CosmoProf's, SalonCentric's and independent distribu- tors' professional-only stores. • A dynamic shift continues from indepen- dent salons and mid-tier chains toward family-economy chains, chair/suite rentals and upscale men's barbershops. • The hot men's sector grew more than 7%. • Sales at Regis continued to decline. In 2014, the company may shed its high-end salons to concentrate on its value brands. • Major players in the ever-growing chair/ suite rental category are listed. New sections in the 2013 study feature an analysis of barbershops by state and percentage of the United States, and upcoming ingredient issues. For questions and/or purchasing information, contact Bulsara, cbulsara@augustmail.com, or visit proconsultants.us. ■ "The state of our salon industry is weak and rapidly changing," says Cyrus Bulsara. Results From New 2013 Industry Study E d i t o r ' s N o t e 0 4 1 4 . i n d d 4 Editor's Note 0414.indd 4 3 / 5 / 1 4 1 : 3 2 P M 3/5/14 1:32 PM