Best Practices for Pricing Your Hair Extensions and Wigs

Want to take your hair extension business to new heights and never look back?

The good news is you've landed in just the right spot! 😎

We're going to use all the experience here at Dropship Beauty to guide you through everything you need to price you hair care products like a boss.

Turnover Is Vanity, But Profit Is Sanity

Anyone can sell thousands and thousands of dollars of wavy hair bundles for the same price they bought them — that's easy.

The key, as we're sure you already know, is to make sure there is enough of that pie left over at the end for you to take your slice.

Turnover is always going to be a bigger number than profit, and it's one that a lot of new startup lace wig sellers focus on too much. 

Ask any seasoned seller, and they will tell you that it's the profit that will actually keep you sane.

Profit pays bills, boosts your bank balance, and puts you in the hot seat when you want to live the life of your dreams.

Yes, you need a high turnover to get rich in this business, but it's the profit that you actually take to the bank and spend. 

Profit Margins Are Built on Cost Analysis

The wholesale price you pay for a box of new straight hair bundles is only part of the picture.

There are always extra costs that have a habit of getting forgotten about or pushed to the side, only to eat away at your margins without you even realizing it's happening.

Cost analysis is the smart strategy of looking at every individual cost that comes with selling your wigs.

Here are just a few examples:

• The wholesale cost of the wigs and closures.
• The cost of designing, building, and hosting your hair store.
• Any business insurance you need to have under your name.
• Shipping, storage, returned goods and write-offs.
• Damaged stock and unsold stock were sold at a loss.

We know this can feel daunting, and that's why we want to give you a gentle nudge to come and check out how we do things here at Dropship Beauty.

You never know. You might be able to cross off some of these frustrating costs with nothing more than one quick connection to the experts. 

Market Research Keeps Your Business Ahead

Is the world getting lit up by queens who are stepping out in kinky curly closures?

Well, as a business owner, you need to know about it before anyone else.

You might not be able to drive the trends just yet (that comes later when you have a brand the world looks to for inspiration), but you can be first on the scene. 

Researching the market at least once a month will show you new trends that are emerging and give you the chance to adjust your next order.

This is a line of business where there is always something new just over the horizon, so why can't you be the first to take it to a wider market?

Once you've found a winning product and figured out the true cost of selling it, all you have to do is price it like a pro. 

Underselling Yourself Is a Risky Business

You might think that to capture market share you need to undercut everyone else on price, and there is some merit to that school of thought.

It's unlikely that you'll be able to charge top dollar on your very first consignment, so you need to be competitive when it comes to price.

But if you undercut everyone out there and are far cheaper, you run the risk of:

• Killing your profit margins before you get started.
• Appearing too good to be true and getting ignored.
• Gaining an unfair reputation for offering poor-quality products.

Savvy buyers love a bargain, but if you're so much cheaper than everyone else, they will assume you're just selling inferior goods.

What you need to do is strike the right balance. 

Hit the Sweet Spot in the Middle of the Pack

You want to be cheaper than many, more expensive than some, and trusted by all.

Building your pricing structure so that it offers real value for everyday shoppers with average incomes will connect you with the largest possible audience.

From there, you can do some really exciting things that will definitely help you elevate your new wigs and extensions business before you know it:

• Offer a premium range within your store where you charge more.
• Run discounts and lightning sales where you clear older stock.
• Introduce an essentials range and have a lower price point for some SKUs.
• The beauty of this approach is that by starting off on the sweet spot, you can branch out once you've built trust.

You will be catching the eye of the biggest section of the market with how you price and position your hero products, and you will then be talking to higher and lower-paying buyers as well. Ideal when you want to offer a little bit of everything.

But hold that thought…

Too Much Diversity Will Muddle Your Pricing

The key point here is that you need to make sure your hair branding and core store content match your sweet spot pricing.

Have a separate sale section and a premium option as a dropdown menu, and you'll make sure things remain nice and clear.

You want new visitors to your store to know that they are in the right place, so spell it out to them. 👌🏿

We can help you do it by making sure that you only ever sell premium quality extensions and wigs with robust margins.

Our service will even help you populate your store with new products so that every time the fashion trends change, you're always two steps ahead of the rest.

Just what you need to hear when you want to be able to create a business that will bring your dream life one step closer with a little of social media marketing.