A Shared Hair Salon Without a 'Wonjangnim': Sharing Space, Earning Individually

Korea's First Shared Hair Salon Founded by Shim Jaehyun, CEO of 'Seven Avenue'
Automatically Manages Work Schedules, Sales, and Administration
Enhances Work-Life Balance and Responsibility
Satisfies Both Designers and Customers
Operating in 4 Locations... Expanding to 7 This Year

[Asia Economy Reporter Moon Hyewon] A mixed-use complex mall in Hapjeong-dong, Mapo-gu, Seoul. On the basement first floor, accessible by escalator, there is a luxurious hair salon adorned with a chandelier. Although I made a reservation through the Naver application on a Friday afternoon, the store was quite crowded with customers.

At first glance, it looks no different from any other hair salon where a skilled 'owner' is present, but upon closer inspection, this place is a 'solo battle' ground where hair designers, each running their own separate business, gather.

'Seven Avenue' is the largest shared hair salon in Korea. It features a new profit structure where designers pay only for what they use rather than receiving incentives, and the remaining profits are returned to the designers. Designers manage their own customers directly, and if marketing is needed, they can receive desired training and feedback through the headquarters. Each designer also sets their own monthly work schedule. Because the system is based on individual designers operating their own business, there is no hierarchy or rank.

Sim Jaehyun, CEO of Seven Avenue and founder of Korea’s first shared hair salon (pictured), explained, "The biggest difference from regular hair salons is that hair designers do not receive incentives but operate in a horizontal structure where each designer manages and operates their own customers."

Sim, a hairdresser with 20 years of experience, officially converted the Hapjeong branch near Hapjeong Station in Seoul into a shared hair salon in the second half of 2018. The shared hair salon is the result of his efforts to eliminate inefficiencies in the existing salon structure and enable all hair designers to enjoyably earn more income. He believed that the sharing economy model, seen in shared accommodations and vehicles, could also work in the hair industry.

After successfully operating the first branch in Bucheon, Gyeonggi Province, Sim opened the second branch near Hapjeong Station in Seoul, but it did not perform as well as expected. He identified the irrational working structure of hair salons as the cause of the business slump and boldly made all the junior designers at the Hapjeong branch franchise owners. He said, "Hair designers are freelancers but still receive work orders from the salon owner. However, since the industry does not properly observe welfare such as adherence to working hours, it was unfortunate that designers often could not work on equal footing with each other."

During a one-year trial period, Sim developed detailed operational plans and regulations for the shared hair salon with each franchise owner. The hair designers’ job satisfaction greatly increased as they could manage their own customer schedules and flexibly adjust their working hours. This means they could maintain a better work-life balance.

Since the cost paid by customers becomes the full income of the individual designer, each designer’s professional responsibility increased. This has been praised for leading to higher customer satisfaction. The average haircut cost for male and female customers is around 20,000 to 30,000 KRW, comparable to high-end salons in the Gangnam area. According to recruitment announcements, each designer can expect up to 73% of the profits.

From the designer’s perspective, the relatively low initial startup cost of about 60 to 70 million KRW is also an advantage. Costs can be further reduced by jointly purchasing expensive equipment, shampoos, conditioners, and other supplies with other designers in the salon. Besides the Hapjeong branch, Sim operates shared hair salons in four locations across Seoul and the metropolitan area, including Gangnam and Bundang. This year, he plans to expand by adding about seven more franchise locations.