iQ Magazine Fall 2026 by Wella Education

ISSUE A DATA MAGAZINE FOR BEAUTY PROS

DATA IN ACTION RETAIL: HERO OR VILLAIN? COMPENSATION: A BETTER STORY, BACKED BY DATA THE PROFITABILITY GAP MEGAN JASPER GADABOUT

ISSUE 1 | SUMMER 2026

photo: David Raccugilia

ISSUE

SUMMER 2026

PERSPECTIVES

A DATA MAGAZINE FOR BEAUTY PROS

MEET IQ

WELCOME TO iQ: THE LIGHT BULB MOMENT

iQ was created to help us better understand the professional beauty industry through research, data, and conversation. By bringing together insights from across our industry, our hope is to foster stronger collaboration, better decisions, and a healthier future for the profession we all serve.

Many ideas start with a lightbulb moment. Ours came after years of data conversations across this industry, circling back to the same frustration: we talk about data constantly, yet many still don’t know what to do with it, or how to find it.

Throughout this issue, you’ll find Qnity Institute research alongside data and perspectives from other respected organizations and industry leaders. Sometimes the data confirms what we believe. Sometimes it challenges long-held assumptions. Our goal isn’t simply to report the numbers, but to provide context, perspective, and a deeper understanding of their meaning.

Professional beauty is an interconnected ecosystem. Salons, spas, and medspas create careers. Manufacturers develop products. Schools prepare future professionals. Distributors, technology partners, and industry organizations help businesses grow. When one part succeeds, we all benefit. When one part struggles, the effects ripple throughout.

That’s where iQ started.

THE PROFITABILITY GAP | 4 What separates the industry’s most profitable salons?

THE MODERN FINANCE FUNCTION | 8 How modern businesses are turning financial data into better decisions.

DATA IN ACTION | 10

IN GOD WE TRUST; ALL

RETAIL: HERO OR VILLAIN? | 14

BRING DATA.

OTHERS MUST

— W. EDWARDS DEMING

COMPENSATION: PERCEPTION VS. REALITY | 18 The numbers behind one of professional beauty’s most misunderstood conversations.

DATA ON THE ROAD | 24

Our schools prepare the next generation of professionals. Salons, spas, and medspas create careers. Brands, distributors, technology partners, and industry organizations help those

This is a concept issue, built to bring stories, insights, and design to data. Professional beauty has always had a complicated relationship with data: we have plenty, yet it still feels scarce, with real deficits in some areas, surplus in others, and, in some cases, data shaped to serve an agenda. Sorting out which is which has become an important, and at times contentious, conversation.

businesses grow. Every part of

We don’t claim to have all the answers, or to be the definitive voice on data in professional beauty. Nobody should be.

Business owners are navigating

WE HOPE iQ BECOMES A CATALYST FOR MORE CONVERSATION, GREATER CLARITY, AND A DEEPER CURIOSITY ABOUT THE NUMBERS SHAPING OUR DECISIONS. There are many stakeholders in this conversation, and just as many perspectives. Some agree more than we realize; others disagree in ways worth exploring, not avoiding. That tension is why this publication exists. As our industry navigates one of the most significant periods of change in its history, data matters more than ever. Thank you to everyone who shaped this first issue. We hope it sparks a few lightbulb moments of your own. If it does, I’d love to hear about them.

Highlights from the conferences, conversations, and collaborations bringing data to life. Tom Kuhn, Qnity Institute

ERIN KUHN BHANSALI President, Qnity

our industry depends on the health of the others. Today, that ecosystem is changing. Consumers are buying differently. Schools are facing new challenges. an increasingly complex economy. While these may seem like

A look inside how Megan Jasper, VP of Gadabout and VerVe Salons, turns insight into action.

The industry’s biggest retail debate, examined through data.

PROFESSIONAL BEAUTY HAS ALWAYS BEEN ABOUT CREATING OPPORTUNITY

separate conversations, they’re deeply connected. Better data helps us challenge assumptions, make better decisions, and advocate more effectively for the future of our profession.

I hope iQ becomes a resource that helps all of us build a stronger future together.

Thank you to Wella for making groundbreaking research on salon compensation and profitability possible, and for helping bring iQ to life. This support fuels the insights that move the industry forward. 3

WHAT SEPARATES THE MOST PROFITABLE SALONS

AVERAGE SALONS SURVIVE TOP SALONS THRIVE

AVERAGE

TOP 25%**

TOTAL LABOR

60%

53.5%

RETAIL

11.9%

12.0%

RENT

6.9%

5.5%

REVENUE / SQ. FT.

$602

$769

NET INCOME

3.2%

10.5%

*Total labor, rent, and net income are based on a percentage of total revenue. **Top 25% refers to the quartile of salons with the highest profitability in the study.

2025 P&L STUDY

INSIGHT TO ACTION

Data, Insights, & Trends on Salon Profitability

The value of data isn’t in the report. It’s in the decisions leaders make because of it. The Qnity Institute Profitability Study wasn’t created to confirm what salon owners already knew. It was created to help them make better decisions.

For the second consecutive year, the Qnity Institute, together with independent CPAs, analyzed the financial performance of 157 salon locations representing more than $300 million in revenue. Built from actual P&L’s, not surveys, this study reveals where every dollar goes and what separates the industry’s most profitable salons.

During the +1% Profit Challenge, leaders used the study to identify their greatest opportunity for profit.

FIVE DECISIONS. ONE DATA SET. While every business was different, several themes emerged: LABOR: One company consolidated a management role that had been under discussion for more than a year. OPERATING EXPENSES: Several owners reviewed recurring expenses, vendor contracts, and marketing spend for the first time in years. PRODUCTS: Teams tightened inventory controls and reduced unnecessary product waste. REVENUE: Instead of chasing more clients, some shifted their focus to increasing utilization and rebooking. SPACE: Owners evaluated revenue per square foot before committing to expansion.

ISSUE 1 | SUMMER 2026

2025 P&L STUDY

DATA, INSIGHTS, & TRENDS ON SALON PROFITABILITY

THE CFO LENS

WHERE DOES EVERY DOLLAR GO?

THE DATA LOOKS BACK. THE DECISIONS LOOK AHEAD.

Profitability starts with knowing where every dollar goes and where top performers make different choices.

READING THE NUMBERS DIFFERENTLY Financial statements tell us where we’ve been. Great financial leaders use them to decide where to go next.

LABOR — 60¢ Labor consumes 60¢ of every dollar. Top

That’s the CFO lens.

performers operate at 53.5%, creating a

A profit and loss statement isn’t simply a report card. It’s a decision-making tool. Every line item tells a story about the business, from labor and occupancy costs to product performance and profitability. As those inputs shift, so should the questions leaders ask.

6.5-point advantage driven primarily by non-service support payroll and benefits, not service pay.

Today’s financial environment is changing quickly. Labor costs continue to evolve. Operating expenses remain under pressure. Retail is being reshaped by new consumer behaviors, while new revenue opportunities continue to emerge. Looking backward is important. Looking ahead is essential.

OPERATING EXPENSES — 17¢ Other operating expenses are made up of marketing, credit card fees, utilities, and many other small expenses, most under 2% of total

The value of data isn’t simply understanding what happened. It’s using those insights to inform budgets, compensation strategies, pricing, expansion plans, vendor relationships, and the decisions that shape the future of a business.

revenue. Top performers simply manage these expenses more intentionally.

PRODUCTS — 13¢

As our industry grows more sophisticated, so too should the financial conversations surrounding it. Premium salons, spas, and medspas would benefit from a community where CFOs and financial leaders can share ideas, benchmark performance, and learn from one another. Like the businesses they support, that conversation is still evolving.

Products consume 13¢ of every dollar for retail and professional supplies. The most profitable salons manage product costs with discipline. Retail averages 12% of total sales across all participants, top performers included.

SPACE — 7¢ Rent costs average 7¢ of every dollar. The biggest difference is productivity: top performers generate $769 per square foot versus $602 for the average salon.

PROFIT — 3¢ After everything else, the average salon nets 3¢ on the dollar. The top 25% keep 10.5¢.

ISSUE 1 | SUMMER 2026

YOUR CPA IS NOT YOUR CFO

Confusing the two is costing you money. I’ve been both and the overlap is smaller than people think. A CPA prepares tax returns and advises on tax matters. A full-time or fractional CFO is part of the team: watching for shifts before they hit, staying ahead of the curve, and using your numbers to guide the budget, the comp plan, or the next hard conversation. Don’t expect your bookkeeper or controller to fill that role either—different skill set, different mindset. —Tom Kuhn

THE MODERN FINANCE FUNCTION

LEADERS MODERNIZING THEIR FINANCE FUNCTION

A FRAMEWORK TO EVALUATE & UPGRADE

Real companies. Real progress. Real results.

by TOM KUHN

These salon and spa leaders are strengthening their finance function to drive clarity, improve cash flow, and make confident decisions for the future.

For many small businesses, there isn’t a true finance function. Instead, it’s often pieced together over time: a bookkeeper here, a CPA there, patched together systems and tech. Each piece may do its job, but together they don’t always provide the visibility or financial leadership the business needs. Those things still matter, but they’re no longer enough.

DATA & REPORTING

4 TEAM & EDUCATION

With tighter margins, rising costs, new technology, and more complex business models, today’s finance function needs to do more than report the past. It should help leaders understand what’s happening now, anticipate what’s ahead, and make better decisions with confidence.

MODERN FINANCE FUNCTION

— VAN COUNCIL OWNER, VAN MICHAEL SALONS

2 SYSTEMS & STRUCTURE

3 TECH & AI

We’ve spent years assessing how finance operates inside salons, spas, and other small businesses, then helping leaders build a stronger function around it. This is the four-part framework we use. It stays current because we don’t stop there: we incorporate new technologies and data, pressure-test it against a network of finance experts and operators, and rebuild whenever the evidence says to. WHY UPGRADE? Peace of mind, clarity on what’s driving your margin, and the confidence to make big decisions instead of guessing.

A STRONG FINANCE FUNCTION HAS FOUR PARTS

WE EVALUATED OUR FINANCIAL OPERATIONS AND CLEANED UP OUR PROCESSES WHICH HELPED US TO GAIN TOTAL VISIBILITY INTO OUR CASH FLOW.”

• Replaced subjective bonuses with a clear, profit-based formula.

• Gave real-time visibility into cash flow and financial position.

• Compared performance line by line against industry benchmarks.

• Rebuilt the financial foundation from the ground up.

• Identified reporting gaps hidden inside a nine-location portfolio.

• Built a financial system designed to scale with growth.

• Cut complex financial decisions from weeks to days.

• Grew revenue at all three locations in a down industry.

• Built a structured monthly briefing for the executive team.

• Measured whether specific business changes actually increased profit.

• Analyzed contribution margin to determine an affordable bonus structure.

• Turned monthly financials into a coaching tool for managers.

The common thread is data. Each is using Qnity P&L Study benchmarks to inform decisions and improve profitability.

THE TAKEAWAY

DATA & REPORTING

SYSTEMS & STRUCTURE

TECH & AI

TEAM & EDUCATION

Runs on data, not gut feel. Rising costs and thinner margins mean every key decision needs a number behind it.

Forward-looking, not just historical—every number needs a name and an owner, not just a reconciliation.

Tech platforms connected, efficiencies gained, addressing the opportunities and threats from AI.

Where most businesses get stuck. The right people, internal or external, make or break the other three. (See callout: Your CPA Is Not Your CFO.)

The best finance functions don’t just report the past—they create clarity today and confidence for tomorrow. Modernizing your finance function is an investment in better decisions, stronger margins, and a healthier business.

READY TO EVALUATE YOUR FINANCE FUNCTION? Interested in a finance function assessment or fractional CFO? Contact tom.kuhn@qnityinc.com

IT’S TURNED US FROM A SMALL BUSINESS INTO A COMPANY WHERE WE SEE POSSIBILITIES WE NEVER WOULD HAVE SEEN IN OUR LIVES.” — SONYA GETTINGER OWNER, HOLLYWOOD HAIR

DATA IN ACTION

LEADING WITH INSIGHT Golden Lightbulb Winner Megan Jasper uses data every day to coach her team, strengthen performance, and build a better business.

wenty-five years into her career at Gadabout SalonSpas and VerVe Salons in Tucson, Arizona, Megan Jasper has come to one clear conclusion: good decisions need good data. As a hands-on VP of the 6-location, 230-teammate salon spa

MEGAN JASPER Vice President Gadabout and VerVe SalonSpas Tucson, Arizona

DATA DOESN’T REPLACE INTUITION. IT GIVES ME SUPPORTING EVIDENCE. ISSUE 1 | SUMMER 2026

group, Megan is involved in everything from operations and marketing to education. She doesn’t just believe in data. She uses it. She believes accurate data strengthens not only their business, but the entire profession. Here are four examples of data in action at Gadabout.

DATA IN ACTION

3 TALENT ADVOCACY

FOUR WAYS DATA IS IN ACTION AT GADABOUT

A founding participant in the original Pro Beauty Compensation Study, Megan keeps the infographic on her office wall, and she’s handed it out more times than she can count. To high school counselors touring Gadabout’s education facility. To Education Advisory Board members. To young people at Gadabout trying to convince skeptical parents that a career in beauty is a

real financial choice.

COMPENSATION DESIGN

“I hear story after story of parents who don’t want their kids to go to cosmetology school because they think they’ll never make a living or

When Gadabout undertook a post-pandemic compensation overhaul, Megan and co-owner Jana Westerbeke

they kick them out of the house if they do enroll. It breaks my heart.”

went straight to the data. Drawing on their own payroll figures, industry benchmarks, and financial models,

The infographic doesn’t argue. It just shows the numbers, and real numbers

they mapped the impact of every proposed change on individual team members and the company, before

change minds.

making any changes. They updated their pay structure, creating a transparent model that was a win for the company and the team. Team members gained clarity, confidence, and real “what if” scenarios around their earning potential. The business got a structure aligned with company financial health. DATA ALLOWED US TO HAVE CONVERSATIONS WE NEVER COULD HAVE HAD BEFORE,” MEGAN SAYS. “IT TOOK THE EMOTION OUT AND PUT THE FACTS IN.” TIP

Never make a compensation change without data. Period.

COACHING & CAREER PATHING

Like employees at many companies, members of their service team often underestimated how much money they were actually making. Not because anything was hidden, but because no one had ever laid it all out for them in one place. Megan changed that. Once or twice a year, every team member sits down with a full compensation summary: not just commission income, but the real dollar value of benefits, continuing education, and every other investment the company makes in them. Pair that with a dose of practical financial education, and something shifts. WHEN PEOPLE SEE THE FULL PICTURE,” MEGAN SAYS, “THEY START TO SEE A REAL CAREER, NOT JUST A JOB.” TIP

Once or twice a year, give service team members a full compensation summary, with wages, benefits, education value, all of it. Add a little financial education with it.

Source: Infographic—Qnity Institute 2022 Salon Compensation Study.

WHEN PARENTS SAY A CAREER IN BEAUTY WON’T PROVIDE A LIVING, THE DATA BECOMES MORE THAN A SPREADSHEET, IT BECOMES PROOF.” TIP

Share compensation data with counselors, schools, and parents. The perception that beauty careers don’t pay well is costing the industry its next generation of talent.

4 PROFITABILITY Going into a one-on-one, a team member assumed her husband’s corporate career was the household’s financial engine, until she sat down with her numbers. Working part-time, with scheduling flexibility that let her be fully present as a parent, she was actually the primary income earner. The data didn’t just surprise her. It changed how she saw herself. She just became an educator for us and has a desire to become a beauty brand educator. The financial freedom we gave her has literally changed her life. She realizes she is capable of caring for her kids, providing a financial future for herself and her family, and being more successful than she ever could have imagined. —Megan Jasper

ISSUE 1 | SUMMER 2026

Gadabout always strives to get better. They participate in and devour data from the Qnity P&L Studies. Megan loves seeing exactly where Gadabout lands against the full range of participating companies, not just an average. That benchmarking disciplines their decision-making. It sharpens spending choices. It helps them ask better questions: Where are we outperforming? Where is there room to improve? GIVE ME EVERYTHING. TELL ME HOW WE CAN DO BETTER. IT DOESN’T HAVE TO BE BROKEN TO IMPROVE.” MEGAN SAYS. “AND THE DATA ALWAYS TELLS US WHERE TO LOOK. TIP

Participate in Qnity Institute profitability and compensation studies, as well as other studies. The data you get back is worth far more than the time it takes to submit, and the more companies participate, the more powerful it gets for everyone.

Source: Infographic from the Qnity Institute 2022 Salon Compensation Study.

Presented at A Celebration of Lightbulb Moments at The FiLL, the Golden Lightbulb Award, honors individuals who have made a meaningful impact on the professional beauty industry. Among our past honorees are leaders who have championed better industry data, sponsoring research, supporting data collection and analysis, and helping turn information into insight that moves our industry forward.

ROBERT PASSAGE

VICTORIA ANTHONY

JARED SANDERS

Pivot Point

Wella

LSA CPA

RETAIL: RET HERO VILLAIN OR

Few topics have divided the salon industry more than retail.

ne camp believes retail is THE key to stronger profitability. The other sees it as a distraction that ties up cash, consumes valuable space, and shifts focus away from the service experience. Depending on who you ask, retail is either the hero of the business or its biggest liability.

The data suggests neither is true. The Qnity Salon Profit & Loss Studies found that the industry’s most profitable salons generated an average of 12.2% of total revenue from retail. None of the top performers relied heavily on retail, but all maintained a healthy level of product sales, most falling between 9% and 15% of total revenue.

RETAIL GENERATES 3-6x MORE PROFIT THAN SERVICES AT THE SAME REVENUE.”

— INDUSTRY COACH

SALON RETAIL ISN’T A PROFIT CENTER—IT’S A DISTRACTION FROM THE REAL BUSINESS.” — INDUSTRY COACH

Surprisingly, the least profitable salons averaged 16.4% retail, challenging the long-held belief that selling more products automatically leads to higher profits. The difference wasn’t retail itself. Lower-performing salons often carried larger inventories, devoted more space to retail, and absorbed higher occupancy and product costs. In many cases, strong retail sales compensated for weaker service performance rather than contributing to overall profitability. At the other extreme, salons with very little retail left revenue and client education opportunities untapped. The findings point to a more balanced conclusion. Retail is neither the engine that drives profitability nor the obstacle holding businesses back. Like pricing, payroll, or occupancy costs, it’s one component of a healthy business model. The most profitable salons didn’t choose between services and retail. They built businesses where both worked together.

ISSUE 1 | SUMMER 2026

INDUSTRY SIGNALS: RETAIL SALES

WHERE DID THE RETAIL GO

Three independent data sources are pointing to the same conclusion: salon retail continues to lose ground.

by ERIN KUHN BHANSALI

rick and mortar retail is now competing with every creator on a phone. The data is clear. While in salon and spa retail sales continue to decline, consumers haven’t stopped buying professional beauty products. They’ve simply changed where they buy them. As highlighted in the Kline report and other industry data, prestige haircare continues to grow

The Q1 2026 KIM Report, based on POS data from more than 10,700 salons, found retail revenue declined 2.9%, while units sold fell 4.0%. At the same time, the average service ticket increased 3.2%, suggesting clients continue to invest in professional services while purchasing fewer products in the salon. Using a different methodology and dataset, Kline's Q1 market data reported salon retail sales declined 9.8%. The trend is also reflected in the Qnity Salon Profit & Loss Study, which documented a three-year decline in retail as a percentage of total salon revenue, even as service revenue increased each year.

Retail is shrinking while services grow

2.93% RETAIL REVENUE

4.00%% UNITS SOLD

Different studies. Different methodologies. Same signal: salon retail is losing share while services remain the primary driver of growth. What it means: The question is no longer whether clients will buy professional products—it’s whether they’ll buy them from you.

3.19% SERVICE TICKET

through specialty beauty retailers, Amazon, and other online channels. The question isn’t whether consumers

Unlike traditional e-commerce, TikTok creates demand through discovery. A creator demonstrates a product, the algorithm amplifies it,

$1 BILLION

The growth has been extraordinary. Launched in the United States in late 2023, TikTok Shop generated nearly $1 billion in beauty sales during the second quarter of 2026, surpassing Sally Beauty’s quarterly retail sales without operating a single storefront. Brands are responding

quickly. Olaplex has opened a storefront, Paul Mitchell is following, and prestige brands are rapidly

A creator can generate a sale after capturing 15 seconds of a stranger’s

SALON ADVANTAGES

TRUST

A salon professional often spends 45 minutes to two hours with a trusted client. Yet historical Qnity research found that 71% of salon guests never receive a retail recommendation. That’s not an indictment of salons. It’s a measure of the opportunity. Consumers haven’t stopped buying professional products. They’ve simply embraced new ways to discover and purchase them.

Salons still hold one advantage no algorithm can replicate: trust. The opportunity isn’t to out-TikTok TikTok—it’s to make product recommendations as intentional, personal, and effortless as the service experience itself.

ISSUE 1 | SUMMER 2026

Professional Beauty Association

the professional beauty industry a simple question:

HAS SALON RETAIL REACHED THE BOTTOM, OR WILL THE DECLINE CONTINUE?

The answers varied, but several themes emerged. Most agreed that the professional recommendation remains one of the salon’s greatest advantages. The challenge isn’t influence. It’s where the purchase happens. Industry leaders pointed to the continued shift toward online buying, the growing importance of digital retail tools, and the need for more consistent retail education and coaching. While opinions differed on whether in-salon retail will rebound, there was broad agreement that the future belongs to businesses that connect trusted recommendations with a seamless purchasing experience.

The word cloud highlights the themes that surfaced most often across participant responses.

THE TRANSACTION HAS MOVED ONLINE, AND CONVENIENCE ISNT REVERSING

EXPLICIT OPTIMISM THAT RETAIL RETURNS MEASUREMENT BY RETAIL-TO-SERVICE RATIO

THE STYLIST’S RECOMMENDATION STILL CARRIES WEIGHT SOCIAL PROOF AS COMPETING INFORMATION SOURCE MANUFACTURER AND BRAND RESPONSIBILITY

EXCLUSIVITY, PREMIUM, GATED DISTRIBUTION

45 MIN—2 HR IN CHAIR

attention.

President

PBA President Leslie Perry asked leaders from across

embracing the platform. The real story isn’t TikTok’s technology, it’s its efficiency.

LESLIE PERRY

SOCIAL IS A PROFITABILITY LEVER

U.S. BEAUTY SALES Q2 2026

and purchase happens with a tap.

AROUND THE INDUSTRY

THE BETTER-INFORMED CLIENT MERCHANDISING AND ENVIRONMENT

WORKFORCE WAS NEVER TRAINED TO SELL

Much of that shift is being fueled by TikTok Shop.

PRICE PERCEPTION IS A MYTH

are buying professional products. The question is: why aren’t they buying them from their salon or spa?

COMPENSATION: A BETTER STORY, BACKED BY DATA UNDERSTANDING THE ECONOMICS OF A PROFESSION

hat began as a resource to help salon owners have more informed conversations with their teams has

The findings are clear. Qnity Institute studies found

31,500 W-2s

grown into one of the industry’s

most comprehensive compensation benchmarks. Across three studies, the Qnity Institute analyzed

THE DATA TELLS A DIFFERENT STORY employee-based beauty professionals earned 58–121% more per hour than commonly reported federal wage data.

data representing all 50 states.*

$1B

MEDIAN HOURLY EARNINGS

VERIFIED PAYROLL

For too long, the public conversation about

QNITY INSTITUTE

4,000 SALON LOCATIONS

careers in professional beauty has been shaped by

ALL 50

incomplete data and outdated assumptions. Our

STATES

goal isn’t to replace other points of reference, it is

Annual earnings tell only part of the story. Beauty

more than 31,500 W-2s, over $1 billion in verified payroll, 450 companies, 4,000 salon locations, and

WHY HOURS MATTER

INDEPENDENT SALONS 1-10 locations, 2023

$36.14

BUREAU OF LABOR STATISTICS

$17.30

professionals often choose flexible schedules while earning competitive hourly incomes. Average hours worked were 26.4 hours per week in independent salons and 24.3 hours

CHAIN SALONS 11+ locations, 2024*

$26.65

$16.87

to provide a more complete picture. By combining

in chain salons. Without considering hours worked, compensation comparisons

verified earnings with actual hours worked,

*This reflects a different workforce segment and is not directly comparable data to ‘Independent Salons’.

the studies offer industry leaders, educators,

can be incomplete, and misleading.

policymakers, and future professionals a more accurate understanding of what a career in beauty can offer.

THE BIGGEST MISTAKE IN BEAUTY COMPENSATION? LOOKING AT ANNUAL EARNINGS WITHOUT LOOKING AT HOURS WORKED.

* These studies were based on IRS-attested W-2 earnings and actual hours worked, not estimates or self-reported surveys. This is source-based, verifiable earnings data that reflects how the industry actually operates.

ISSUE 1 | SUMMER 2026

PERCEPTION VS. REALITY The conversation about compensation reaches far beyond the salon. It influences recruiting, career education, workforce development, and public policy.

PERCEPTION

REALITY

Low wages

Competitive hourly earnings

Long hours

Flexible schedules

Dead-end career

FIVE WAYS TO USE COMPENSATION DATA

Strong career opportunities

WHY THIS DATA MATTERS

SCHOOLS Recruit & prepare future professionals

EMPLOYERS Strengthen recruiting, retention, & compensation strategy

FROM INSIGHT TO ACTION

BRANDS & DISTRIBUTORS Strengthen the professional channel

TECHNOLOGY PARTNERS Enable decisions through reporting & analytics

POLICY MAKERS Better understand the economics of the profession

Understanding compensation now matters beyond salons and schools, it’s shaping conversations with policymakers, regulators, and the future of career education.

Benchmark compensation against credible industry data.

LOOKING AHEAD

Strengthen recruiting with real earnings

The future of professional

information.

beauty depends on attracting the next

Lead compensation conversations with facts

generation of talent.

instead of opinions.

Better information helps industry leaders tell a more

Support career education with verified

accurate story about the

outcomes.

opportunities available within the profession. No

DATA THAT ADVOCATES

Advocate for the profession using credible

single study can solve

research.

every challenge, but

Reliable data doesn’t simply inform businesses. It helps shape the future of the profession.

better data can improve the conversations—and

>> Erin Kuhn Bhansali presenting Qnity Institute findings on Capitol Hill.

BETTER DATA. BETTER CONVERSATIONS. BETTER DECISIONS.

RECOMMENDED READING Trade Up: Why the Future Belongs to Skilled Workers and How Career Education is Transforming the Workforce. In Trade Up, Jason Altmire and Riley Burr argue that the traditional college path is failing a generation of students and employers alike, and make the case for skills-based education as the roadmap to closing America’s widening workforce gap.

decisions—that shape the future.

For more details on Qnity Institute Studies, go to qnityinstitute.com

ISSUE 1 | SUMMER 2026

INDUSTRY SIGNALS

iQ TEAM

Our sincere thanks to the individuals and organizations whose collaboration,

BY THE NUMBERS ZENOTI Q1 2026: THE NEW GUEST GAP Zenoti’s Beauty & Wellness Benchmark Report analyzes POS data from thousands of salon, spa, and med spa locations across eight industry categories, giving operators a read on how they stack up against peers.

-1.3% New guest visits fell 1.3% year-over-year in Q1 2026 for full-service/luxury salons—the industry-wide decline hasn’t reversed.

+3.1% Top-earning salons bucked the trend, growing new guest visits 3.1%, even as the broader market pulled back.

expertise, and support made iQ possible and for helping advance the beauty and wellness industry through the power of data.

THE KIM REPORT Q2 2026: GROWTH IS STILL PRICE RELATED, NOT TRAFFIC The KIM Report is a monthly salon-industry benchmark from SalonInteractive (thekimreport.com), aggregating key industry metrics from a diverse range of beauty professionals through anonymized point-of-sale data.

SPONSORS We gratefully acknowledge our sponsors, whose generous support helped

MICHELLE SHUSTER

-4.5% Retail is a units problem, not a dollars

operator—saw new guest visits drop 6.3%, nearly 5x the industry-wide decline.

-4.08% The 1–2 stylist cohort, 60% of the data panel, was down 4.08%, the only cohort negative for the quarter or the year. Pricing held there; clients did not. Every other cohort grew.

CORINNE MURRAY Project Manager

ADDITIONAL SPONSORS OF QNITY INSTITUTE STUDIES

LINDA HENNEMAN Design

SPECIAL MENTIONS The following individuals gave generously of their time, counsel, and insight to help shape our data work.

WE’RE NOT GROWING BY SERVING MORE CLIENTS—WE’RE GROWING BY CHARGING MORE TO THE SAME ONES..” REBECCA EZOLT Data

—ALAIN AUDET VP SALES & MARKETING, KIM REPORT

Sources: Zenoti Q1 2026 cohort data (Luxury & Full-Service Salon), new guest visits, year-over-year vs. Q1 2025. The KIM Report, Q2 2026 vs. Q2 2025, published August 13, 2026 (SalonInteractive). For more details, including the makeup of the data base and the different cohort groups, go to www.thekimreport.com

MARY BETH BERNS CEPA Succession Advisor, Qnity Inc.

Millions of small businesses, salons included, will change hands over the next decade as baby boomer owners retire. For some, it will be an extraordinary opportunity. For others, it will be a missed one. The question isn’t whether your business will transition. It’s whether you’ll be ready when the time comes. Succession planning doesn’t happen by accident. Too many owners wait too long, leaving fewer options, and in some cases,

STUDY PARTICIPANTS CANDICE GLIATTO +1 Profit Challenge

SUCCESSION PLANNING

iQ Founding Sponsor:

+2.9%

-6.3% Benchmark-tier salons—the average

—SUDHEER KONERU CEO, ZENOTI

Qnity Institute studies and iQ possible.

Editor

The average service ticket rose 2.9%. while unique clients edged up just 0.14% and visits fell 0.56%. Color was the one exception on volume, up 0.91%.

problem. Revenue fell 4.50% but units fell 7.48%. Clients are buying fewer items and trading up on the ones they still buy.

DON’T OVER-INDEX JUST BECAUSE YOU SEE NEW GUEST COUNTS TO BE TOO LOW. IT ISN’T JUST ABOUT YOU—IT’S WHERE THE INDUSTRY IS. BALANCE YOUR STRATEGY: OPERATIONALLY, HOW DO I IMPROVE?”

ACKNOWLEDGEMENTS

Our sincere thanks to the businesses whose trust, participation, and shared data made Qnity Institute studies, and future industry insights, possible. To participate in future studies to go to www.qnityinstitute.com

closing businesses that could have thrived under new ownership. Mary Beth Berns, CEPA*, Qnity Succession Advisor, and a salon owner for nearly 40 years, has experienced both sides of the process. In her article, The Great Salon Ownership Transfer is Here, she explores why readiness, not a shortage of buyers, is the industry’s greatest challenge.

DATA DRIVES BETTER DECISIONS

The Qnity Institute is Qnity’s research and data division, delivering credible, independent research that closes the gap between perception and reality, empowering salons, spas, medspas, and schools to make smarter, stronger business decisions. >> Learn more about the Qnity Institute at qnity.com.

*Certified Exit Planning Advisor

ISSUE 1 | SUMMER 2026

DATA ON THE

ROAD In this issue, we’re spotlighting four Qnity connected voices who translated hard

Candice Gliatto at Serious Business 2026

numbers into real, live conversations from Dublin to Austin and beyond.

LOOK FOR THE NUMBERS BEHIND THE NUMBERS. Hear Qnity Institute Data at Upcoming Events: AUGUST Zenoti Growth Tour | Detroit, Michigan

Victoria Anthony at ICA Spring 2026

Tom Kuhn at The FiLL 2026

SEPTEMBER Schwarzkopf Lift | New Orleans, Louisiana Innergize by Zenoti | Seattle, Washington OCTOBER 2TO10 | Greenville, South Carolina AACS Annual Conference | Las Vegas, Nevada APRIL 2027 The FiLL | Scottsdale, Arizona Erin Kuhn Bhansali at Phorest Salon Summit 2026

Interested in supporting the Qnity Institute or iQ? Contact Erin Kuhn Bhansali at erin. kuhn@qnityinc.com to discuss sponsorship opportunities, bringing iQ to your company, event, or speaking engagement, or contributing content to a future issue. Tom Kuhn and Candice Gliatto at Innergize by Zenoti 2025