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«HAIR EXTENSION divality.com Content Introduction.. 3 Global Demand.. 4 US Market.. 5 UK Market.. 8 South Africa Market.. 14 Hair Extensions ...»

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For example, Rocco Altobelli in Roseville charges about $1,200 per session for wax bonding extensions, which last about two months. Clip-in extensions cost $700 to $800 for a 16-inch set, which includes cut and color. These need to be replaced every six months. (Prices can vary according to a customer’s needs, the salon notes.) Perlman, who sells to mostly inner-city customers, judges the state of the hair economy by the use of credit cards. When he first started, 10 to 15 percent of purchases were on credit. Now, it’s 40 to 50 percent. He believes that’s a major indicator of the worsening urban economy.

“It’s a complex business,” Perlman says. Inner-city customers are buying less and they’re buying cheaper products, he says. The demand is still there, but it’s a matter of affordability.

The Twin Cities market is racially and economically diverse, compared with other markets where Smith does business. About 30 percent of Sunny’s clients are black—AfricanAmerican, Somali or other African immigrants, or biracial. About 30 percent are white, 30 percent are Asian or other ethnicities, and about 10 percent are from the transgender or crossdressing population.

Manufacturers have diversified their offerings exponentially. There were two types of hair when Perlman entered the business, he explains. Sunny’s alone buys from up to 35 different vendors, each selling its own variation on human hair. Perlman now has 1,000 SKUs; they all come from a factory, but not the kind you would imagine.

The Source China and India supply most of the hair to Sunny’s, says Smith. The nations are the two major exporters of human hair, and most of it comes off the heads of people in lowerincome brackets.

China is the No. 1 exporter of human hair, followed by India. That’s mostly due to population, availability and cultural traditions. In India, women grow their hair by the ponytail and donate it to a temple as part of Hindu religious practice. The temple then sets up a hair auction, says Smith. Factories bid on the hair, and the temple reaps 100 percent profit to put back into service, upkeep and community outreach.

“The donors are aware that people buy their hair,” Smith explains. “It’s lucrative for the temples because they’re getting it for free. Whether or not we buy it, it exists because people are growing it for religious purposes.” The Seller The hair then goes to processing facilities, which sort the ponytails by length. They can either put it into something called a weft—basically a flexible framework for the hair that keeps it in place. Wefts are sewn into extensions called “weaves”—where a person sews the extension into his or her hair. Alternately, the ponytail can be “pre-tipped” with keratin for “strand-by-strand” extensions. Pre-tipped extensions use a wax method of application.

Next, the hair can be processed for textures and colors. The most desirable hair is called raw hair, also known as “virgin” or “remy.” It’s the most natural, and has undergone the least processing. Factories can then sell directly to the retailer or to a middleman.

Hair is sold in bulk or by the strand. A retailer such as Sunny’s can buy bags of hair in bulk or individual ponytails.

After this long journey, retailers sell hair to customers who take it to their stylist to get it customized, cut and fitted, for prices that can run into the thousands. Others can buy hair extensions from their salon to save time and hassle, but many choose to buy hair from retailers instead of the salon, because it’s usually cheaper. Retailers typically also have a broader selection than stylists do, explains Smith.

The Cost of Beauty Celebrities are willing to pay upward of five figures when they buy hair, which translates to higher prices for the everyday consumer. “People are definitely spending more,” Smith says. “The more open celebrities have been to extensions, the more the average woman has been open to them. You get celebrity-quality extensions available to people now, and they pay celebrity-quality prices.” An average full 16-inch weave—a type of extension that is sewn into a tight braid of existing hair, and which has been popular among black clientele—can cost anywhere from $50 to $4,000, depending on the type of hair, length and quality. They differ from other extensions because they are sewn in, rather than utilizing a heat and wax application system or employing temporary extensions called clip-ins.

Typically, well-made extensions are sold by the ponytail, meaning that it comes from one person’s head. The more hair needed, the more ponytails sold. However, cheaper extensions and weaves can come from several people. Customers pay for how long the hair lasts and the quality of processing. Cheaper hair tends to shed and fall apart.

“If you get hair that’s $10.99, a lot of that hair is from the brush,” Smith says. “They put it in a bag, they take it down to a factory, they have no idea what the person has done with their hair and they coat it with a lot of chemicals, like conditioning agents. You’re basically using that hair until those conditioning agents wash off. So it’s the longevity that you’re paying for.” Retail cost for a full head of 18-inch extensions can cost anywhere from $150 to $1,000. That higher-priced extension wholesales for $370 a kilo (a kilo produces five to 10 extensions) according to A. Kishore Kumar of the Human Hair Supermarket in Chennai, India.

Declining supply is becoming a factor. Fewer women are growing hair to sell to the masses, Perlman says, which he attributes to a rapidly industrializing China, with other sources of income now available. Hair donors can also sell hair in cities, where they pay more, which also drives up prices, he says. “The supply, right now, is not meeting the demand.” As the market adapts to fill the need, human hair extensions are fast becoming as common as lipstick in the beauty world. But they remain the only beauty product growing off the productive capacity of someone else’s head.

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Elite Extensions, a retailer based in Rancho Cucamonga, CA, sells a wide range of hair extensions on 20 to 25 carts in Las Vegas and California. “We carry more than 60 different colors and extension lengths,” says co-owner Madaar Osman. “They range from half-synthetic/half-human [hair] to 100 percent human hair,” depending on what the customer wants. “We also have a new exclusive line, Remy, that features the finest hair that’s available in the industry.” Extensions run from $175 to $750, with human-hair extensions pricier than their synthetic counterparts.

“The human hair is by far the most popular, even though the price is higher,” Osman says. “When the ladies try it on and feel how natural the hair feels, they usually buy the product.” Corioliss also offers a line of extensions with $250 to $300 price points that clip on and can be matched to virtually any hair color. Today’s woman demands flexibility, so “extensions come in 20 to 22 inches... and can be attached at the root line or cut-depending on the wearer’s preference,” Schueppl says.

Uniquely colored or dyed extensions have also hit the market recently. Funny Extensions, made by Silly Stuff, headquartered in Monument Beach, MA, wholesales a range of hair accessories, including two-toned, re-useable extensions that appeal to a variety of age demographics and can be sold year-round. The company has a start-up package that “instantly turns a kiosk or counter into a salon,” and includes DVD demonstration-video displays.

In Orlando, FL, wholesaler Hot Lockz has easy-to-apply dyed extensions in 20 vibrant colors and three distinct styles-straight, curly and braided. Using a clamp process that requires just a few minutes of training for salespeople to learn and doesn’t involve glue or weaving, Hot Lockz can be applied easily and quickly by salespeople without prior hairstyling experience.18 Many retailers offer “traditional” hair care products such as shampoos, serums and sprays designed to be used in conjunction with the styling tools they sell. This not only allows retailers to boost add-on sales, but to draw customers back to the cart when the consumable http://specialtyretail.com/issue/2008/08/retail-products/retail-productfeatures/good_hair_days_product_feature/ products run low. Now more than ever retailers are stocking products that are eco-friendly, organic or all natural.

Amika’s hair care line features organic olive oil and Moroccan argan oil, which repair hair damaged by blow drying, explosure in the sun and other hair stressors, rebuilding hair cells and promoting shininess.

“Deep conditioning at a salon costs anywhere from $80 to $150 for one time,” Kadosh says. Amika’s deep conditioner provides four or five treatments, at a suggested retail of $120.

Amika also has a styling spray, hair cream, shampoo, conditioner and hair serum, plus a deepconditioning hair mask, which Brosh reports is a big seller at Growing Rich carts.

Brosh’s customers who purchase a hair-styling tool receive a VIP card that allows them to return to the cart to have their hair styled for free. “We have two employees at the cart at all times, so one can work on a customer’s hair,” says Brosh, who notes that the free-styling promotion serves two purposes. The strategy brings the customer back to the cart to purchase additional products, and allows cart personnel to demonstrate how well the products work.

Some of Amika’s cart retailers take appointments to do customers’ hair (after they buy a straightener or other tool). “This eliminates the need for hawking people,” Kadosh says, adding that customers can return to have their hair styled an unlimited amount of times within a year of purchase. Each time the customer comes back for styling, “You have someone coming in who says, ‘Oh yeah, I bought that [straightener or curler], and it works great,’ which sells more products for you.” Osman says Elite Extensions treats each of its carts as if it were a salon. “We hire hair stylists that are very experienced and licensed, and who work well with our clients,” to develop personal relationships just like millions of women have with their salon stylists, Osman says. “People feel more comfortable buying extensions from a stylist rather than a regular sales associate.”19 Many retailers round out their product selections by offering a range of unique and attractive decorative hair accessories that make traditional barrettes look so yesterday.

Pomchies, located in Phoenix, NV, wholesales washable, multicolored hair-ties that resemble cheerleading pompoms. Made from swimsuit material and available in 400 colors (with no minimum order), Pomchies have already caught on with the tween set. Best-selling colors include In the Pink, Party Girl, Fiesta Light, and color combos that match school or sports team colors. Bright colors are always a hit with the younger girls, says Pomchies’ owner Heather Logan.

Scottsdale, AZ-based Hair Diamond specializes in hair extensions and its namesake product, Hair Diamonds, includes accents that feature Swarovski crystals, faux gems and mock marble. The product can be sold individually or in sets ranging from 12 to 50 pieces.

Silly Stuff’s line is called Blinx-Bling and also contains Swarovski crystals. Products in the line include crystal wire extensions, crystal hairbengles (jewelry that dangles from the hair) and Beady Shifters hair beads.

Luminence sells crystal tresses, strands of Swarovski crystals and individual crystals that can be applied anywhere, but it’s the company’s Glowby that’s getting a lot of attention these days. A fiberoptic hair extension of sorts that glows; the tween set especially wears them to parties, proms and events-or just to look cool every day.

A new entry to the market this year is High Country’s Zhoe Accessories line, which includes unique double combs, quattros (they’re a headband, ponytailer, bracelet or necklace), TwistAbouts hair ties, and a variety of clips, barrettes, etc. Based in Rock Springs, WY, the http://specialtyretail.com/issue/2008/08/retail-products/retail-productfeatures/good_hair_days_product_feature/ company’s founder, Bridget Frame, created the new line, available in several collections: the Desert Collection, Coffee Bean Collection, Island Getaway Collection and the Tuxedo Collection for an upscale look.

As the economy tries to find its footing, it’s no wonder that women are turning to specialty retailers for unique products that give them the salon-styled look without the salonstyled price tag. Plus, with many carts and kiosks offering extensive hair services-even free styling on a repeat basis-shoppers have a reason to come back again and again. Thanks in large part to the availability of so many new hair products and accessories, the market for specialty retail hair concepts is likely to grow significantly in the months and years ahead.

Kellie Smith worked in full-service salons for 16 years and always found the process of fitting customers with hair extensions quite tedious. It wasn’t an ideal situation. “Hair extensions are not cheap, and we had to charge customers 50 percent up-front to order the product and to ensure they would keep their appointment,” she says. “It put everyone involved in an uncomfortable position.” It bothered Smith enough to pose this question to her husband, “Why can’t there be a hair store, where people can walk in, pick out their hair [extensions] and swipe their credit card to buy it like they would a pair of jeans?” she asked. Smith continued to think about this.

Then when shopping at a mall, Smith spotted a kiosk in the common area and had an inspiration. “I realized a kiosk would be great for a ‘hair store.’ People could just walk right up to it, and there wouldn’t be the overhead of a salon,” Smith says.20 http://specialtyretail.com/issue/2008/08/retail-products/retail-productfeatures/good_hair_days_product_feature/ The result is the Tangles Hair Extensions kiosk, which opened in September at the Apache Mall in Rochester, MN. It offers hair extensions, made of 100 percent Remy human hair, a high grade of hair used in hair extensions.

The extensions are priced at $450 and up. Hair extensions take about three hours to apply and generally last four to six months. After that time, hair extensions need to be refitted, since new hair growth affects fit and they tend to get tangled easily.

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