How To Benefit From Taking Deposits in Your Salon in 2024

If you’ve ever worried about whether or a client will show up for an appointment, or how to guarantee that someone can pay for expensive services, taking salon deposits might be the way to go.

Jump to The Section You Like

1. What Is the Cost of No-Shows?
2. How to Take Deposits for Appointments in Your Salon?
3. Benefits of Taking Deposits in Your Salon
4. Salon Cancellation Deposit Policy Examples
5. Conclusion

What Is the Cost of No-Shows?

Did you know that more than 33% of people have no-showed for at least one salon appointment in the past.

This can add up quickly: a salon with an average service cost of $30 that has two no-shows a week will lose $240 in potential income a month or $2880 a year.

Add the cost of paying a stylist’s salary, plus support staff like salon assistants and the fact that they can’t take another paying client during these times, and you’ve got big losses.

How to Take Deposits for Appointments in Your Salon?

Taking salon deposits to secure an appointment doesn’t have to be awkward or time-consuming. Here are some best practices that you can follow to make it go smoothly.

1. Use Salon Software

Use salon software with online payments and ask your clients to pay a deposit (save the card, or pay in full) before booking an appointment with you. A good salon management software will make allow you to take credit cards and set custom deposit amounts.

You can also send them a link for their reservation automatically, letting them secure the booking using their credit cards on their phone or computer.

2. Implement a Salon Cancellation Policy That Includes Deposits

Before you start taking deposits, it’s essential to write a cancellation policy and communicate it to your clients: post it on your salon website (preferably on the booking page), and to your online booking, and in your salon where clients can sign off on it before making an appointment. Consider making it a policy to request a deposit from your clients before allowing them to book an appointment. This practice will financially protect your salon and incentivize your clients to show up for their appointments

Educate loyal clients on why you now have this in place to protect their appointment times and help everyone get the best possible service.

For more ideas on how to create and execute a salon cancellations policy, check out our post about Effective Salon Cancellation Policy.

How to Address Exceptions?

Avoid making new rules for special cases- this will just lead to more confusion later on. In most instances, it’s best to just have one policy in place and stick to it.

In emergencies, online booking using salon software allows you (not the clients) to adjust appointment times if necessary.

Benefits of Taking Deposits in Your Salon

Implementing a deposit system during the appointment booking process can benefit your salon, staff and clients in several ways. Here are some of the advantages:

1. Reduce No-Shows and Late Cancellations

Clients will be less likely to forget or cancel if they’ve already paid a deposit. Plus, this is a great way to get commitments from new clients booking online. This sets the foundation for a professional, trustworthy and mutually-respectful relationship.

For more ideas on how to reduce no-shows, check out this article: 15 Ways How to Reduce Salon No Shows.

2. Recover Lost Revenue

A missed or late appointment is a waste of your staff’s time and your salon’s money (not to mention that it creates stress and frustration for everyone who is waiting). Being able to recover at least part of this amount by taking salon deposits can help offset this loss.

3. Improve Future Cash Flow Planning

This is true for both you and your clients, since everyone will know how much they’re spending ahead of time (and you can predict the rate of actual no-shows more easily with a record of them in your booking system).

4. Increase Staff Scheduling Efficiency

You won’t have to worry as much about whether you should schedule more or less staff in case of no-shows, since you’ve got a firm commitment. This will help a lot when it comes to cutting down on staff frustration, too.

5. Cover Salon Upfront Expenses

Some salon services can be expensive to provide, and require you to purchase special supplies beforehand. Deposits can go towards these salon expenses like products or special items needed for a service (wigs, extensions, etc.).

6. Build Customer Loyalty

Most no-shows are probably not regular clients with a relationship with your salon, so why let them get in the way of loyal clients who may be waiting for an appointment time? Taking deposits builds trust and loyalty by ensuring that everyone who books is serious.

7. Deliver Outstanding Customer Experience

With the right staffing and a certainty over who will show up, your salon can deliver better customer service and meet your clients’ needs. This can go a long way towards securing repeat bookings.

8. Increase Salon Retail Sales

Since many clients are paying for services in advance, it will be easier to upsell them on retail products when they’re in the salon with money to spend. Prepaying in part or in full before the service appointment leaves them with a bigger budget on the day of.

9. Improve Future Cash Flow

You’ll have increased visibility over your salon’s bookings and be able to plan better strategies to improve your cash flow, going forward. You can even strategize and plan ways to compensate for periods when no-shows and cancellations are more likely to happen.

Salon Cancellation Deposit Policy Examples

Here’s an example that you can use in your own salon:

“We really value our clients’ time and want to give you the best experience possible. Before your appointment, we require a 25% deposit to secure the booking. This will be deducted later from your service fee. We’re looking forward to seeing you!”

Conclusion

No-shows and last-minute cancellations are a pain for everyone at the salon. They’re stressful, disappointing and expensive to deal with.

Taking salon deposits is an easy and straightforward way to help keep your staff, clients and balance sheets happy.

Citations

Deposits and relationship lending
https://academic.oup.com/rfs/article-abstract/12

Demand deposits: a comparison of the behavior of household and business balances
https://www.richmondfed.org/-/media/RichmondFedOrg

Money and business cycles
https://www.nber.org/system/files/chapters/c5179/c5179.pdf