CAIRO - 17 May 2018: Coiffeurs, as Egyptians refer to them, have been in Egypt for a
very long time. Generations have grown up watching their mothers, aunts and female relatives meet up at the salon and spend the day there. But what has always been a latently regular part of Egyptians’ lives has changed considerably over the years, both socially and in numbers.
Business Today Egypt sits down with three industry leaders to get the intel on the business. “When we started 40 years ago I felt that the business wasn’t regarded as it should be... When I traveled to study in Paris, I felt that a hairstylist in Egypt was not regarded highly enough [as in France],” Egyptian hairdresser tycoon Mohamed Al-Sagheer tells Business Today Egypt.
According to Al-Sagheer, in France, hairstylists were treated much differently, more
like artists. According to industry gurus, Al-Sagheer, Kriss, and Kimi Safadi, their branches are frequented by 500 clients per day, with each client spending between LE 500 to LE 2,500 per visit post-flotation.
Post-float shakes and tremors
All three agree that the business of coiffuring in Egypt has been deeply impacted by the
2016 flotation. Profit margins fell monumentally, while curbing expenditure turned out to
be a true challenge for the A-class hairstylists who knew that maintaining their quality was everything in this business.
Safadi, Al-Sagheer, and Kriss’ public relations and operations manager Karim Kamal
all concurred that while their top-of-the-line products’osts increased exponentially overnight, not to mention their other costs such as rents, salaries and so on, their prices could not be increased to meet the market’s new indices.
“I end up paying at least 40% taxes, especially since the new value-added tax policy has been introduced, which heavily affects profits,” Safadi says. “I import a type of Brazilian Keratin, which is considered the best in the market, and it is now for LE 6,000.”
The biggest challenge of the float for them was having to increase their prices between
20% and 80%, which led to regulars visiting less frequently. “Demand was a little affected; a client who would visit twice a week now only visits once,” Al-Sagheer says.
“The economy’s instability affected the materials we work with. We are one of the chains that import lines of products, and we both use them and distribute to others. But if you previously had LE 1 million that you spend on the business, this million became worth LE 360,000 overnight.” Kamal maintains that the same effect took place with Kriss’ chain, and so did Safadi; regulars did not stop coming, they just stopped coming
as frequently as they did.
They also add that while the price increase angered some of their clients, it was still to enough to maintain a healthy profit margin. “Last year was the first time in 38 years that
we have a negative in the budget. We had a minus of 1.5% in last year’s budget. This was a result of the inflation that happened, costs rising and we couldn’t raise our prices that much due to the magnification that took place in terms of prices.
Rent prices increased, everything increased. Hote rents increased, for example, and we pay them in dollars. We used to pay, for example, LE 80,000 for a store space in a hotel; overnight they asked for LE 160,000 or 170,000. That is in addition to the value added tax,” Al-Sagheer explains.
An enticing, but tricky market
As Al-Sagheer mentions, the market of hairstyling in Egypt has opened up in the past 15 to 20 years, which was about when Kriss launched their first branch in Korba. “The market has gotten aggressive since Kriss first opened 15 years ago,” Kamal says. “He was considered the only Lebanese [acclaimed hairdresser] in Egypt at the time, and when the concept of a beauty salon was established in Egypt, more Lebanese came to invest in the market.”
“Part of the success that creating brands has given to the profession is that now there are people who regard it as a source of income. Instead of opening cafes or boutiques like they used to, businessmen or women now decide to open a hair salon instead. That is largely due to the emerging brands that were created over the years, and there are a lot of people flockin to imitate it or to follow it,” Al-Sagheer explains.
Essentially, the business boomed when people started to notice the space it takes up in society after Al-Sagheer founded the first chain of A-class salons. Businessmen regarded it as a venture that had a small margin for failure, especially if they had the right coiffeur to lead it, and thus began investing in that market; a business that wouldn’t go out of business because it was one built on a demand that never
But an important part of being a successful player in the field, undeniably, is skill, and not just the skill of coiffuring. “It is important to be skilled as a hairdresser of course, because then you have a following … but you also need to be skilled in terms of marketing and business,”
Safadi explains. Al-Sagheer and Kamal agree. “Success is not only standing behind a
chair working. Skill is important; it’s important to be good at it. Some people rise then fade quickly because they don’t develop their skills. When a client comes, she’s expecting a result, and when she doesn’t get it, it affects the business,” Safadi adds.
To Kriss, much like Al-Sagheer, the system largely depends on education. Having opened his own academy, Kriss works intently on ensuring that all his hairdressers are educated in the biology and chemistry of hair and the products they use on it. “Education is the future in this industry,”
Kamal asserts. He adds that newer generations “have come to know what is good for
hair and what isn’t,” which means that to stan out from competitors, they need to be educated on their business to “establish trust between the customer and the place.” Kriss’ emphasis on developing his stylists and educating them has led to complaints throughout his branches decreasing by 95% over the past three years.