Lessons For Entrepreneurs Based On What I Learned From My Dorm Room Barbershop
In this article, I talk about one of the first businesses I had as a student, and the lessons I’ve learned from it. I think this information is very useful to those also thinking about starting their own business. Although I was young when I first started it, believe me when I tell you that it was definitely a real business that generated me a lot of money as a university student.
At my peak, I made about $400-$600 a week, which is a nice chunk of change for someone who is going to school full-time. I could have made even more if I decided to work more than 4 days a week or on Sundays, which I did on rare occasion. If you are currently a university student and are reading this, I urge you to try starting your own dorm room barbershop. It was one of the most successful businesses I’ve ever run.
Scroll to the bottom if you don’t care about the actual story and are only interested in what I’ve learned from the business.
Free Hair Cuts
When I was in university, I opened a dorm room barbershop. I didn’t know how to cut hair but I took the time to research and teach myself by watching YouTube videos and buying books on cutting hair. Before I started charging, I gave my friends and their referrals free cuts. That’s right – I spent about a month and a half just cutting hair for free. I didn’t know how to cut hair and was pretty bad at it.
The only way I would be good at it was to get customers and to practice on them. However, who is going to allow you to cut their hair when you’ve never done it before? Well, good thing university students are poor and desperate. All I had to do was offer them a free haircut and they were willing to let me to experiment on them which allowed me to polish my hair cutting skills over time.
After a while, I noticed that I no longer had to go up to people to ask them to cut their hair for free. My regulars (about 10 guys) started spreading the word for me as I started getting better. They told their friends to come to me because I gave free haircuts that were almost as good as a haircut from a regular barber.
When I started noticing an increase in customers, I realized I was good enough to start charging. So, I charged $5 a person for a full haircut. This was still about $10-$15 cheaper than going to a barbershop. Even though I was no longer giving free haircuts, customers continued to walk in the door.
Ten Dollar Hair Cuts
My phone started blowing up more and more. After a while, I decided to increase to $8 a haircut. I figured that an increase to $10 was too high of a jump from $5 however, if I said $8, barely anyone will have exactly $8 with them. They will either have two five-dollar bills or a ten-dollar bill. Either way, people are used to tipping for service so I figured it would be rare for someone to ask for $2 back.
It turned out that I was right. Once I increased the price to $8, all my customers would give me $10 and not ask for change back. Business got so big that I needed to create time slots for customers. I also needed time to do school work so I got myself organized. I chose only 4 days a week to cut hair. Three of the days were weekdays (Monday, Thursday and Friday) and one was a weekend (Saturday).
Thursday and Friday were chosen so that people can have a fresh haircut for parties or weekend events. Saturday was chosen so that those that couldn’t make it on Thursday and Friday could still have a haircut for Saturday night parties. My busiest days were Fridays and Saturdays, when I often worked past midnight.
Mondays were for the stragglers. These were people that I could not fit on Thursday, Friday or Saturday. It was also meant for those that needed a haircut for an event on Monday, Tuesday or Wednesday (such as a job interview). I became so busy that I had to turn people away after all my time slots were booked up.
Some people told me that I should increase my prices to $15 or even $20. To be honest, I could have. I sometimes had people come to me and offer me $30 just to slide them in my schedule really quickly because they needed the haircut badly.
The most I was offered was $50 to squeeze someone in because they were desperate. Normally I wouldn’t accept the bribe however, I am not a fool. If someone is willing to offer me $30 or $50, it’s my business, I can make the time and move some names around. This was done in a way that didn’t ruffle any feathers. I pride myself on being professional. So, I would explain to someone exactly why I needed to move them and if they were not on a time crunch themselves, they often did not mind.
As I said, I could have increased my prices to even $15 without it affecting my clients at all but, I kept it at $8 (which was really $10) because I wanted to give back to the students that were making me successful in my dorm room venture. Because of them, I didn’t have to take a university student job making minimum wage which was only $6.75/hour at that time.
Cutting hair, I was making $20/hour and sometimes more depending on the line of people that needed a haircut. Some just needed a quick trim while others needed more work. My prices were cheap enough that I didn’t distinguish a quick trim from a full haircut. The only thing I distinguished was a “lineup” where I cleaned up the sides of the hair and around the back and front and only charged $5. I really had a great thing going as a student.
Yes, It Was Technically Illegal
Technically speaking, what I was doing was illegal because I was not actually licensed and did not go to a barber or hairstyling school. I was self-taught. However, I took my job so seriously that I made time to study and learn about barbershop cleanliness. I bought all the proper equipment for sterilization and made sure to always clean everything around me thoroughly. Putting my customers first was my number one priority. That is why I did all that, and I wanted them to know it.
So, I made sure to display all my cleaning and sterilizing equipment. I further invested in my customers by purchasing a couch for them to sit and wait on if they arrived early. I invested in a big screen TV so that they could enjoy their surroundings, as well as a stereo system because I knew it would create that vibe my customers wanted in a shop.
When I graduated, a lot of people were sad to see me go. Not because they cared about me specifically (I wish)… but because they would no longer be getting those top-notch haircuts they had been getting all year long. Furthermore, they definitely couldn’t get it for the price they were paying.
Trouble With The Board Of Health
With the dorm room barbershop business, I did an insane amount of research and prepared myself as best as I could. Looking back, I am very glad I did. When I was in my third year of university (3 years into the business) I received a call from the local board of health department. They asked me to meet them at the library because they had something important to talk to me about.
It turned out that they heard about my hair cutting business and were concerned. The director of the department was told to look into my case because word had gotten out that I was providing hair cutting services, and even though I was good at it, I wasn’t licensed (you need barbershop schooling to be licensed). It was a great compliment but one that got me into hot waters with the authorities.
Long story short, the director was a good guy. He first asked me a whole bunch of questions about the cleanliness of my business, the sterilization of my equipment, and more. Again, good thing I did a lot of research. I told him exactly what I did and what tools I used. He was impressed and said that he visits real barbershops and they don’t even follow the guidelines I followed to ensure proper care is taken for the customers. I assured him I was taking this very seriously and was taking the necessary precautions to ensure customer safety. This was enough to make him satisfied.
My Lucky Break
At that time, I also had a website that advertised my business, my location and my contact information. The board of health director said the following to me before we finally ended our meeting:
There are many students doing side business in their dorm rooms. Many are doing illegal businesses selling drugs, etc. What you are doing is something good. You are providing a necessary service to fellow students at a very affordable price. Shutting you down would be doing a disservice to the rest of the students especially knowing that you understand and follow the proper steps to ensure customer safety.
Because of this, I want to offer you the following option: I want you to take down your website. Take it down so that my people will assume that I did my job. After you do that, keep doing your thing. Just make sure you are operating under the radar. Don’t bring more attention to yourself. Here is my business card. If you anyone ever calls you and gives you trouble about operating without a license, give me a call first and we will take care of it.
I honestly couldn’t believe those worlds. I gladly took his card, went home and took down my website. Nothing changed because I already had more customers than I could handle. I was turning customers away half the time because I needed time to do my school work. It was a win-win for everyone. I continued making my own hours and had enough money to pay off my school fees and expenses while keeping a sizable chunk to pay off my car insurance and other monthly university student expenses.
What Is The Takeaway?
DO YOUR RESEARCH!
In the article below, I talk more in depth about how important doing your research is. Also, get more insight on other mistakes to watch out for as an entrepreneur.
Related Article: The Most Common Mistakes Made By Entrepreneurs
If you do your research you are more likely to succeed and you can also save yourself from potential headaches in the future. I don’t remember the health department guy’s name but if he is reading this and remembers me, thank you very much for understanding and encouraging me to continue being entrepreneurial. That little dormitory barbershop allowed me to learn A LOT about running a business:
1) Focus on your customers. not your revenues
2) Create a schedule and be organized
3) To succeed in business, you have to work hard and do your research
Reflecting On Successful Service Businesses
When I think about large companies such as Netflix and Hulu and how they got there, I realize that they have the same business model as I did. They focused on their customers first. They made sure they had customers that use and like their product. Those customers became hooked. After a while, they started increasing the amount they charged for a subscription.
In the case of Hulu, they kept the amount the same but increased the number of ads they show their customers. The ads are very annoying but I still use Hulu. They offer an option to upgrade to a higher paid plan so that I don’t have to see those stupid ads but for right now, I refuse lol. I’m stubborn and don’t want to give in.
So, I tough it out and watch my shows on Hulu with the obnoxiously long ads. I swear these ads get longer and longer every day. In the early days, they were 10 second ads and now they are a full 5 minutes at times.
Customers have no choice but to pay the increased prices for Netflix and Hulu because they like the product and although no one likes to pay more for the same product, we feel that the prices are not high enough to warrant dropping the service. Yes, others did drop the services when prices increased but most did not.
This is how you run your business. First, focus on acquiring your customers and then after you acquire them, you can focus on generating an income. You can’t have any income without customers!