Government Action to rescue Hair & Beauty Salons UK

The hair and beauty industry was forced to close March 2020 by government order 

Our industry was taken from retail and placed in “hospitality” in order to close us yet we were forgotten when it can to the VAT reduction! 

THE BEAUTY SECTOR AND CLOSE CONTACT SERVICES

The beauty sector remains mainly closed with 80% of services not allowed, many businesses also only operate salons with facial service so still CANNOT TRADE 

This beauty sector is on its knees with up to 370,000 jobs at risk! 
This industry is predominantly women working on minimum wage with no prospects of future employee not in this sector so many will end up on benefits placing further burden on DWP and many cannot retrain due to having to make a living to pay their bills ... 

THE HAIR SECTOR 

• The hair industry is operating at best 40-60% capacity 
• 68% state they will have to make redundancies 
• 98% State they could not pay wages if furlough doesn’t continue and we have a lockdown. 
  97.8% want regulation of our industry 
• only 6 yes 6% have been able to borrow through CBILS to keep their business trading . 
  (stats from preliminary survey results 2020)
• 34 % can only trade for another 3-6 months working at current capacity and will then be forced to close 
• 62% can last 6-9 months working at current capacity 
• with only 4% able to last to. Year!!  
  ( preliminary survey results 2020) 

The industry is in desperate need of financial support to avoid mass redundancies and business closure 

WHAT WE NEED - WHAT WE DESERVE

1. Rescue the industry COVID 19 with a financial rescue plan to include

• 5% VAT rate as per hospitality sector we are now in
• Extend furlough to when a vaccine is available or at least April 2021 
• Extend loan repayment periods on Bounce Back Loans and CBILS to void mass redundancies in Q1 2021 
• police the ones trading illegally trading  putting the reputation of our industry at risk. 

This is what we need NOW !

TO AVOID MASS REDUNDANCIES FROM OCTOBER TO MARCH 2021

BANKING –  CBILS FAILED FOR OUR INDUSTRY 

Business Interruption GOV does not work for most small businesses and only a handful of salons who have assets have been able to secure LOANS which have to be repaid .. WITH WHAT

A realistic plan allowing bounce back loans in addition to CBILS for larger salons. 

INSURANCE   - ONGOING GOVERNMENT FAILED TO INTERVENE SO MANY CANNOT CLAIM ON BUSINESS INTERRUPTION 

A lot of salons have business interruption insurance BUT insurers are not covering COVID-19 – due to not being on the notifiable list when insurance taken out.  Most BI requires damage to property, insurers will not indemnify even in the event of a public authority forcing closure !

So force insurers to honour agreements or classify COVID as a matter of civil unrest or state that any business that had BI insurance before this outbreak are covered under “ damage to property” similar to any natural disaster like an earthquake !

whilst this is being tested in court by the FCA which has also been a huge fight to get it there... Judgement in September with insurers likely appealing so most with cover will go bust !  Even the South African government has intervened so where is our government?

LANDLORDS -  MANY HAVE HAD LANDLORDS FORCE RENT PAYMENTS DESPITE LEGISLATIONS - MORE GRANTS NEEDED .. 

Many businesses who have retail properties on the high street have rent payable and cannot even cover basics. Please legislate that contracts are NON enforceable and no property owner can take measures to enforce any breach of non payment during this outbreak.

HMRC TIME TO PAY - 67%. STATE HMRC HAVE CONTINUED TO CHASE AND NOT HELPED WITH TIME TO PAY 

A lot of uk salons may already have HMRC debt - how are they supposed to service this? - Please give them time to breathe, recover!  Time to pay with what? so please provide a support fund or suspend all HMRC debt for 6 months to give businesses time to -  RESPOND - ACT - RECOVER 

SSP - PAYING EMPLOYEES  NEEDS EXTENDING TO COVER UNTIL A VACCINE IS IN PLACE 

SSP is reclaimable for covid 19 this needs to be extended until the government have a thorough and reliable track & trace system in place and paying upfront as the pressure on employers to pay is un realistic. 

DWP are indemnifying self employed ( which is fair) but business owners cannot meet this payment which will have an adverse affect on every person in the industry from day 1. But if salons have no income and no infrastructure to support your government pledge ( see budget 2020) WE need an emergency fund to pay this... or a re-claim structure that is paid within a set period and not offset - all the government has done is shifted the ssp burden to small business owners.THIS IS IMPERITIVE FOR  BUSINESSES TO CONTINUE TRADING! 

All businesses rely on the public for their business income ! Which is critical to pay employees and other critical operation costs

Our businesses are facing closure so 387,000 people are facing serious hardship and the knock on effect of this is  extreme debt/bankruptcy and all applying for long term benefits! Not good for our economy ...

 Cancellations, rescheduled appointments, and loss of child care during this novel coronavirus outbreak {COVID-19}  are cause of grave concern to all salon owners that run hair and beauty salons as incomes plummet. Fear, anger and dread are being felt by all salon owners so please to help save the hair & beauty industry from collapse bear in mind!   THIS IS NOW STARTING AGAIN DUE TO CONFUSED MESSAGES FROM GOVERNMENT AND POOR MEDIA ABOUT OUR INDUSTRY 

287,000 unemployed from one sector  putting more pressure on the DWP and NHS from the stress and mental health issues this will cause.

70,000 self employed with no possible future potential of employment or security.

And up to £32 billion  Billion lost to the GDP

REGULATION - Our industry must be regulated HAIR & BEAUTY

All commercial salons employ or have self employed qualified to NVQ 1-3 teams. It is a well known fact that there are many non qualified individuals working in our communities. UNQUALIFIED - and in most cases with no industry experience.

WHAT ARE WE RECOMMENDING FOR GOVERNMENT 

Amend the Hairdressing Act of Parliament 1964 to require mandatory State registration through local authority  for all hair stylists  beauticians and barbers

Any treatment or chemical service to be undertaken in commercially licensed premises only! 

To have representatives for our sector in government 

The Hair and Beauty Sector is a significant employer, contributing a large number of businesses to the national economy. To ensure the future health of the sector, it is important that services continue to be provided to the highest possible standard and that consumers are afforded adequate protection.  Our sector needs representation in Government from grass root working salon owners and sector representatives working alongside industry bodies to ensure best practice. 

It is clear from media coverage and Government that the covid crisis is not over yet! Media is also not helping which is resulting in declined public confidence. 

Hair & beauty commercial salon owners are not only facing the already challenging impact of the failing high streets but we now face what could potentially be a financial catastrophic phase resulting in what could be over 49,000 retailers facing extreme hardship and potential closure.

Salons are not just currently providing services to prop up the high street but we are also considered the hub of our communities so play a massive part in maintaining high street presence.

If the UK government do have rescue plans for airlines and transport providers like rail and public transport (which are mainly privately owned) then consider the following:

Salon Service Industry Contribution to GDP

Industry             # businesses  #employees     GDP Cont £Billion 
Hair/Beauty              49,000         370,000                 £7 Billion

Airlines                                          84,302                £12.6 Billion

Rail                                               212,000               £9.3 Billion

IN ADDITiON 

The total hair and beauty sector  590,000    £32Billion

So this is a HUGE contribution to GDP and our countries infrastructure not to mention international trade

Source of Beauty Data 
www.Britishbeautycouncil.com
http://bit.ly/ValueofBeautyReport

UK STATS for airline source data https://www.statista.com/topics/3670/airline-industry-uk/

UK STATS stats for hair & beauty industry https://www.nhbf.co.uk/documents/industry-statistics-booklet/

So the Hair & beauty industry are not just servicing the public in close contact but we have a significant contribution to GDP and employ more people UK residents that airlines or rail.

The Government’s Industrial Strategy and the subsequent Creative Industries Sector Deal, recognised the creative industries as an ‘undoubted strength of our economy’. The Hair and Beauty Sector shares many attributes, such as high levels of entrepreneurialism and global standing, with other sectors represented in the deal such as fashion.
To effectively build on the UK’s creative strengths, the Hair and Beauty Sector should be rightly recognised as a creative industry by the UK Government and as a Foundational economy sector in Wales and given the associated support it needs to continue to thrive.

The Hair and Beauty Sector offers exciting and fulfilling careers, with extensive opportunities and career prospects for skilled practitioners. The potential benefits and rewards of a career in the sector should be better understood by careers advisers, teachers and those formulating policy.  
We call upon the Government to improve careers advice to accurately represent the realities and excellent professional opportunities available. We also call on Ministers and policymakers to reflect this in the comments they make about careers

Although this research highlights the direct contribution of the Hair and Beauty Sector in terms of GVA and employment, there remains a lack of data on the broader contribution the sector makes to the high street 
We therefore recommend that the Governments should commission detailed primary research into the value of the Hair and Beauty Sector.  This should gather primary data from businesses on the direct, indirect and induced impact of the sector in terms of business expenditure, GVA and employment.

There is a lack of data available at UK level that fully examines the profile of the Hair and Beauty Sector and does not capture small businesses that are not PAYE or VAT registered. The report was therefore based on the most robust secondary data available as well as primary research undertaken with the sector in Wales.   
To gain a more comprehensive understanding of the sector, particularly small businesses and sole traders, we recommend that the Government commissions’ UK-wide primary research with hair and beauty employers.
Official GVA statistics are published for broad industry categories and do not provide the level of granularity required for regular analysis of the Hair and Beauty Sector’s contribution to the economy.  
We recommend that the Government asks the Office for National Statistics (ONS) to routinely publish more detailed GVA statistics for the Hair and Beauty Sector.

Extract British Hairdressing Council - available on request

We also need a "level playing field" in our industry with fairness and equality for all. With a fair tax for all including VAT PAYE/NIC Pension& oncosts for ALL.

 

Please hear our voice

Stay safe & well

Collette Osborne

Hairven Salon Group

PLEASE REFER ALL PRESS ENQUIRIES TO 

 joinme@britishbeautycouncil.com