Saks: Beauty of business
As Indians pay more attention to hair styling and nail buffing, international chains set up shops in the country to woo the style conscious consumer. The latest to foray into India is the UK-based salon chain Saks which has set up a 6,000 square foot location in upscale Bandra, Mumbai.
This is the first of the six company-owned salons to be set up this year in the cities of Bangalore, Mumbai and Delhi. Livewell Group owns the master franchisee rights for the India region and has ambitious plans to take the count to 50 in the next five years. Livewell Group is no stranger to the beauty business and will be guided by its experience in running a chain of spas in the Middle East to drive the premium salon business in India.
Industry estimates peg the salon market at Rs 2,500 crore, which includes both services and the value of professional care products retailed through salons. Yet, cutting through the clutter will not be easy as the salon space is highly fragmented and largely unorganised. Besides Lakme Lever’s Lakme Beauty Salons that have a presence in most major cities, there are only a handful of regional chains that have achieved scale. That includes Looks in New Delhi and CavinKare’s Limelight, Green Trends and Naturals, which have a considerable presence in the south. The super-premium space, comprising players such as Toni & Guy and Jean Claude Biguine, is just about taking off.
Saks CEO (India) Burzin Daver is not perturbed with the competition, and believes the brand will make a mark through a differentiated retail experience. For one, the salon will only use top of the league products from L’Oreal and Kerastase for haircare and British skincare brand Elemis for beauty treatments.
That may not be enough given that most international chains are using the same brands. So Saks is also banking on its service. “Unlike other international players which offer only hair services, we are a one-stop shop that offers both beauty and hair care services,” says Daver. The salon has also partnered with L’Oreal Professional to set up an exclusive Kerastase clinic that will offer special haircare consultation. All this comes at a price. A haircut at Saks will put the consumer back by Rs 1,600; at a neighbourhood parlour it may cost anything between Rs 350 and Rs 600.
Experts watching the space say Saks will have to deal with the shortage of skilled talent in the industry to be able to sustain its price point in the long term. While Saks is setting up a hair academy in Mumbai, a bigger issue will be employee retention. “The larger challenge is talent retention after training, as staff prefers to set up their own salons after a few years of experience,” notes Rohit Sood, an independent consultant who was director of sales and marketing, Brushman India, which brought Toni & Guy into the country.