The Decline of Beauty Salons: Surviving in a Changing Industry

In a recent report, Review Co., Ltd., a data provider based in Osaka, unveiled the results of its unique study on the state of the beauty salon industry in Japan. The report, termed the “National Beauty Salon Opening Ranking Report ver3,” covers the period from October to December 2024. The findings reveal a concerning trend: the total number of new beauty salons opened across the country stands at just 1,451, reflecting a decrease from 1,518 in the previous quarter from July to September.

Key Insights from the Report

The report indicates that while the overall number of openings is declining, certain trends are emerging. For instance, there’s a noticeable stability in new openings within local and suburban areas. Additionally, the rise of flexible business models, including home salons and mobile services, points to a shift in consumer preferences and behaviors. This transition reflects broader societal changes that challenge traditional salon operations.

Top Five Prefectures for New Salon Openings

Among the various prefectures, Tokyo leads with 207 new openings. It’s followed by Aichi with 118 and Osaka with 103. Notably, Saitama ranked fifth with 68 openings, illustrating how suburban areas benefit from stable demand due to their proximity to urban centers and favorable conditions for new business launches.

The data highlights five key market trends in the beauty industry:
1. Increase in Freelance and Contract-Based Work
2. Growth of Personal Branding Through Social Media
3. Expansion of Niche Salons
4. Increase in Salon Openings in Regional Areas
5. Enhanced Services for Inbound Tourists

Monthly Trends: What Affects Openings?

When analyzing the monthly opening trends for the year 2024, it became evident that the months with the fewest openings were December, November, and August. This raises questions about what factors contribute to these low numbers during the summer and winter seasons.

Several reasons may account for this decline:
1. Difficulty in relocating or acquiring properties
2. Increased challenges in interior construction and procurement
3. Ineffective customer engagement and marketing strategies during these periods
4. Seasonal sales dynamics that do not align with opening a new business
5. Financial liquidity issues and psychological barriers against making investments

Urban Barbershops on the Decline

A closer look at the beauty vs. barber shop data indicates alarming trends for traditional barbershops in urban areas, where their opening percentages have dropped below 10%. Beauty salons now dominate more than 90% of new openings, illustrating a significant shift in consumer demand and redefining what beauty service spaces look like.

Four Reasons Behind the Decline of Urban Barbershops:

1. Increased operational costs in metropolitan areas
2. More competitive markets where attracting customers is challenging
3. Fading cultural significance of traditional barbershops
4. The preferences for salons that offer modern contexts for beauty services