Don’t tell The Nailco Group president/CEO Larry Gaynor that it’s not prudent to start new ventures in a down economy. In the first quarter of 2003 Nailco has introduced a spin-off of its core catalog of supplies for tanning salon owners and is debuting a magazine for nailcare professionals.
For 12 years, Farmington Hills, MI-based Nailco had mailed its nearly 300-page Beauty Book catalog twice a year to hair, nail, and tanning salons. But early last year, two major manufacturers of tanning salon products, California Tan and ETS, began prohibiting resellers such as Nailco from selling their products to salons that didn’t offer tanning services. The manufacturers feared that the salons would resell the items to consumers at less than the suggested retail price, stealing sales from authorized retailers.
“We were forced to verify that beauty salons interested in our tanning salon products had tanning equipment in their salons,” Gaynor says. “It was a nightmare.”
So in January, following six months of planning, Nailco launched a catalog exclusively for tanning salons, called CTS (Complete Tanning Source). The debut coincided with the start of the unofficial indoor-tanning season, which runs from February to June. The catalog will mail once a year, since tanning salons don’t do much business in the summer and the fall.
The 72-page, 10-1/4″ × 12″ catalog extracts the eight pages of tanning products Nailco used to carry in its core book and adds plenty of others, including oils, goggles, and tanning beds. CTS mailed to 20,000 tanning salon owners nationwide. Prices range from $7 to $35 for lotions and $29.95 to $34,995.00 for tanning beds.
Nailco also spent $175,000 to open a CTS training center in West Bloomfield, MI, that doubles as a tanning salon. “We fly new or future tanning salon owners in to buy the equipment from us and be trained on it by our people,” Gaynor says.
Gaynor hopes to grow the $64 million company’s tanning products business by 35% this year with the new catalog — increasing the tanning salon portion of Nailco’s business from 14% to 17%. To achieve that goal, CTS is offering promotions such as a loyalty program and free shipping.
Moving into magazine publishing
But Nailco is hardly forsaking its core customers. In March the company is introducing Nail Biz, a bimonthly trade magazine designed to help nailcare professionals better run their businesses. “We’re selling advertising only to our suppliers,” says Gaynor, who is the publisher; former public relations executive Wendy Woodard is the editor.
The goal for the first issue, which will mail to 30,000 Nailco customers, is 24 pages of advertising out of a total 56-64 pages. Nailco will mail Nail Biz free to its existing nail salon customers and offer it to prospects at an annual subscription price of $9.95. The company will also mail 10,000 copies of each issue to prospects.