Supercuts 2007 Annual Report Download - page 12

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. In recent years, the Company has expanded its Regis Salons into strip centers. As of
June 30, 2007, 159 Regis Salons were located in strip centers. The customer mix at Regis Salons is approximately 77 percent women and both
appointments and walk-in customers are common. These salons offer a full range of custom styling, cutting, hair coloring and waving services
as well as professional hair care products. Service revenues represent approximately 83 percent of the concept’s total revenues. The average
ticket is approximately $37. 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 $190,000 to $220,000, excluding average
opening inventory costs of approximately $17,000. Average annual salon revenues in a Regis Salon which has been open five years or more are
approximately $426,000. During fiscal year 2008, the Company plans to open approximately 20 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 and waving services as well as
professional hair care products. The customer mix at MasterCuts is split relatively evenly between men and women. Service revenues compose
approximately 79 percent of the concept’s total revenues. The average ticket is approximately $17.
The average initial capital investment required for a new MasterCuts salon typically ranges from $165,000 to $190,000, excluding average
opening inventory costs of approximately $13,000. Average annual salon revenues in a MasterCuts salon which has been open five years or
more are approximately $296,000. During fiscal year 2008, 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 held for sale vary in tandem with changing
trends. These salons offer a full range of custom styling, cutting, hair coloring and waving 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 expanded
into strip centers. As of June 30, 2007, 90 company-owned Trade Secret salons were located in strip centers. Product revenues represent
approximately 88 percent of the concept’s total revenues. The average ticket is approximately $26.
The average initial capital investment required for a new Trade Secret salon typically ranges from $190,000 to $225,000, excluding
average opening inventory costs of approximately $50,000. Average annual salon revenues in a Trade Secret salon which has been open five
years or more are approximately $433,000. During fiscal year 2008, the Company plans to open approximately 20 new company
-owned Trade
Secret salons.
SmartStyle. The SmartStyle salons share many operating characteristics of the Company’s other salon concepts; however, they are
located exclusively in Wal-Mart Supercenters. SmartStyle has a walk-in customer base, pricing is promotional and services are focused on the
family. These salons offer a full range of custom styling, cutting, hair coloring and waving services as well as professional hair care products.
The customer mix at SmartStyle Salons is approximately 76 percent women. Professional
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