The challenges facing the craft industry are reaching a critical point: Rising costs coupled with diminishing motivation paint a bleak picture, as noted by Alexa Ballmann, Vice President of the Federation of Artisans.

In an interview with RTL, the manager of three beauty salons shed light on the industry's current predicament.

Ballmann highlighted a widespread surge in costs across all sectors, attributing it to both escalating product prices and suppliers retracting attractive deals. These challenges are lingering effects of the Covid-19 pandemic.

Moreover, index adjustments are not only impacting salaries but also rent payments, she says.

The sector is witnessing a steady uptick in bankruptcies, with more expected. The Federation of Artisans is registering a significant number of cancellations as individuals opt to discontinue their operations or retire prematurely.

"The beauty salon and hairdressing sector are particularly vulnerable as customers perceive these services as luxuries," explains Ballmann. "During times of declining purchasing power, we're often the first service where people look to cut costs."

In more prosperous times, profit margins stood at 5%, already slim. "Now, we're barely reaching half of that," laments Ballmann. "Passing on the entirety of cost increases to customers isn't feasible. Many freelancers are struggling to stay afloat."

Regarding potential solutions, Ballmann dismisses partial unemployment, citing its cost without corresponding revenue generation. "Small businesses can't sustain this situation indefinitely," she warns. However, she welcomes government initiatives to alleviate administrative burdens, a relief particularly beneficial to small and medium-sized enterprises.

A plea to customers: honour your appointments

"Our customers are our lifeline," declares the Federation of Artisans' Vice President. "The entire sector relies on their loyalty. However, we're increasingly facing negative feedback due to rising prices, which demoralises many. We don't always adjust salon prices in line with reality to avoid shocking customers."

It's crucial to honour scheduled appointments and refrain from last-minute cancellations. "While last-minute cancellations have always been around, they now come with costs we can no longer absorb," concludes Ballmann.