Ralph Bowe, the 68-year-old founder of Contour Hair Salon, says his business has been struggling for the past four years, with turnover flat and labour costs consuming 60% of his income.
"Over the last three, four years, our turnover has been flat really," he told the M.E.N. "At the moment, all we are is tax collectors. Sixty per cent of my turnover is labour costs."
"There's nothing left for me at the end of it. I'm not looking for a way out, but without me my businesses will close."
Two-tiered system
Ralph is among the business owners in the hospitality sector calling for a reduction in VAT. He says the hair and beauty sector is now functioning in a 'two-tiered' system that handicaps businesses like his.
He runs two salons in Leigh and Bury and claims the financial insecurity caused by the current VAT rate has led salons to switch to self-employed worker business models to avoid paying high taxes.
"We're at a competitive disadvantage because we have to charge our clients 20pc extra because we're VAT registered salons," explained Ralph. "We're doing the right thing by employing people and charging people the VAT. People are worried about the cost of living, so they will shop around a little bit."
"The main focus for employed salons like myself is a reduction in VAT to 10pc."
Apprenticeship decline
The knock-on effect has left places like Ralph's too poor to hire and train new staff. A CBI Economics report commissioned by the British Hair Consortium revealed the hair and beauty sector has seen the number of apprentices go from 16,000 in 2016 to 6,000 in 2023.
The report warns that by 2027 that number could be 0. For Ralph, this is already a reality at his two salons.
"I haven't got the money to have an apprentice and I haven't had one for three years in each salon," he said. "There's no money left for me to employ an apprentice."
"That's a cost to the country because we're not training our young people. This is another consequence of what's going on."
Political response
A member of the Salon Employers Association, Ralph has been vying for the attention of politicians. He has dedicated hours to reaching out to the offices of local MPs.
In a message seen by the M.E.N, education secretary Lucy Powell responded by voicing concerns about 'the barriers in hiring apprentices and young people' and told Ralph she has written to the Treasury about issues blighting the hair industry.
Ralph also noted the 'right noises' that Andy Burnham has made regarding reprieve for the hospitality sector, giving him some optimism, but he's aware there's still a long way to go.
"I'm not a political animal really," he said. "I just believe in people who believe in the high street. Burnham is making the right noises and said he will look at levelling the playing field."
"It's encouraging but now it's not a priority with all the other things that are going on. Generally, we need more support, we're businesses that improve the turnover of the high street. You can't get your haircut online."
