Supercuts 2005 Annual Report Download - page 13

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In the preceding table, relocations represent a transfer of location by the same salon concept and conversions represent the transfer of one
concept to another concept.
Regis Salons. Regis Salons are primarily mall-based, full-service salons providing complete hair care and beauty services aimed at
moderate to upscale, fashion-conscious consumers. However, in recent years, the Company has begun to expand its Regis Salons into strip
centers. As of June 30, 2005, 134 Regis Salons were located in strip centers. The customer mix at Regis Salons is approximately 75 percent
women and both appointments and walk-in customers are common. These salons offer a full range of custom styling, cutting, hair coloring,
waving and waxing services as well as professional hair care products. Service revenues represent 82 percent of Regis Salons’ total revenues.
The average ticket is approximately $33. Regis Salons compete in their existing markets primarily by emphasizing the high quality of the
services provided. Included within the Regis Salons concept are various other trade names, including Carlton Hair, Vidal Sassoon, Jean Louis
David (North America), Mia & Maxx Hair Studios, Hair by Stewarts and Heidi’s.
The average initial capital investment required for a new Regis Salon typically ranges from $195,000 to $210,000, excluding average
opening inventory costs of approximately $10,000. Average annual salon revenues in a Regis Salon which has been open five years or more are
approximately $425,000. During fiscal year 2006, the Company plans to open approximately 35 new Regis Salons.
MasterCuts. MasterCuts is a full-service, mall-based salon group which focuses on the walk-in consumer (no appointment necessary)
that demands moderately priced hair care services. MasterCuts salons emphasize quality hair care services, affordable prices and time-saving
services for the entire family. These salons offer a full range of custom styling, cutting, hair coloring, waving and waxing services as well as
professional hair care products. The customer mix at MasterCuts salons historically contained a high percentage of men and children; however,
in recent years, the customer mix has been split more evenly between men and women. In addition, MasterCuts private label haircare line was
introduced into salons during fiscal year 2003. Service revenues compose approximately 78 percent of total revenues for this salon concept.
The average sale at MasterCuts salons is approximately $16.
The average initial capital investment required for a new MasterCuts salon is typically $175,000, excluding average opening inventory
costs of approximately $10,000. Average annual salon revenues in a MasterCuts salon which has been open five years or more are
approximately $300,000. During fiscal year 2006, the Company plans to open approximately 20 new MasterCuts salons.
Trade Secret. Trade Secret salons are designed to emphasize the sale of hair care and beauty products in a retail setting while providing
high quality hair care services. Trade Secret salons offer one of the most comprehensive assortments of hair and beauty products in the
industry. Trade Secret’s retail selection consists of highly recognized brands, and the products carried change in tandem with changing trends.
These salons offer a full range of custom styling, cutting, hair coloring, waving and waxing services as well as professional hair care products.
Trade Secret’s primary customer base includes the female head of the household shopping for her entire family, as well as singles shopping for
their own beauty products and accessories. Trade Secret salons are primarily mall-based; however, in recent years, the Company has begun to
expand into strip centers. As of June 30, 2005, 75 company-owned Trade Secret salons were located in strip centers. The average ticket at
Trade Secret is approximately $23.
The average initial capital investment required for a new Trade Secret salon is typically $195,000, excluding average opening inventory
costs of approximately $40,000. Average annual salon revenues in a Trade Secret salon which has been open five years or more are
approximately $450,000. During fiscal year 2006, the Company plans to open approximately 30 new corporate Trade Secret salons.
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