The NHBF has been working with independent economic analysts Pragmatix Advisory on in-depth research into the effects of the pandemic on the hair and beauty industry.
- What the report says
- Outlook for 2021
- The NHBF’s response: fighting for our industry
- What you can do
The final report – ‘Hair, beauty and the pandemic: An industry at the sharp end’ makes for grim reading. It notes:
- With over 140 days of lockdown in 2020, hair and beauty has been one of the worst affected sectors.
- Hair and beauty businesses saw an average loss in turnover of 45% in 2020, and as much as 57% in some regions.
- Social distancing measures mean that even when open they are operating at around 70% capacity.
- Despite the furlough scheme, full-time equivalent employment numbers were down by 21% on 2019 as staff hours were cut, redundancies made and workers left for roles in other industries with more reliable wages.
- Owners of hair and beauty businesses took an average cash hit of £17,000 in 2020, with those over the VAT threshold taking an even bigger hit.
- Across the industry, one in ten businesses will have failed to deliver any income or dividend to their owners or owner-managers.
Many in the industry are now acutely vulnerable to failure, with 60% of businesses having no cash reserves and two thirds in debt
The independent report warns that 2021 is set to be even tougher with pandemic restrictions placing further strain on already stretched hair and beauty businesses.
- One in seven businesses are acutely vulnerable to fail in 2021, rising to 1 in 4 if lockdowns and restrictions are extended
- Businesses will be out-of-pocket £41,000 on average because of the pandemic by the end of 2021.
- The smallest enterprises will have lost the equivalent of 29% of their 2019 turnover.
- The annual revenue of the largest businesses will be down by 42%.
On the back of this independent report, the NHBF is fighting for:
- A Personal Care Fund for hair and beauty businesses forced to close: Similar funds have already been set up for those in the arts, cinemas, hospitality and leisure, competitive sports, live performance venues, and the aeronautical industry. This would support hair and beauty businesses through their immediate cash-flow crisis and help them begin their journey to recovery.
- Reducing VAT to 5%: When businesses reopen, atemporary cut in VAT to 5% would help businesses recoup their losses and recover. It would also help account for the loss of earnings from implementing close contact guidance requirements. Only 18% of businesses that would otherwise fail would need to survive for this policy to pay for itself.
We are calling for your support to help strengthen our industry-wide campaign. The NHBF is working with Save Our Salons to mobilise those across the hair and beauty sector and beyond to contact their local MPs, share their campaigning journeys on social, and make our voices heard.