Regis struggles as pandemic, rise of work-from-home keeps customers away

The salon chain posted a significant loss in the second quarter.
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While COVID-19 restrictions have been loosened since the lockdowns of March, many Americans haven't returned to their old routines.

The latest sign that the pandemic has led to a major change in consumer habits can be found in the results posted by St. Louis Park-based Regis Corp. on Monday.

The hair salon chain announced its 2nd quarter revenue had fallen 76%, with the company posting a loss of $73.6 million between April and June.

In a statement, CEO Hugh Sawyer said that customers "have not yet returned to historical levels of activity" seen prior to the pandemic, with the company banking on advances in COVID-19 treatment and a vaccine to aid its return to success.

"We remain hopeful that with advances in the treatment of COVID-19 and the potential introduction of new vaccines, customers will return to more typical grooming habits," he said.

Hair salons have mostly been allowed to reopen across the country, albeit with many states implementing capacity restrictions – with Minnesota for example only allowing them to operate at 50% capacity, with reservations required.

Regis says it has responded "vigorously" to the pandemic by introducing new safety protocols at its company- and franchise-owned locations, while it has continued to invest in its merchandise lines.

But it's not just concern over COVID-19 that's keeping people away from salons, but also the rise in working-from-home.

"Most offices and headquarters, headquarters buildings are still closed around the nation," Sawyer said during Monday's earnings call. "And I think people are zooming around in zoom pits to be a little more casual and people are aren't quite as well-groomed as they were when they went to an office."

"But I don't think it's a permanent condition," he continued, adding: "If we get better treatments and if testing improves and God willing, we get this vaccine, I really do believe people ... are anxious to return to a more normal life.

"And I think companies are ready to reopen their headquarters. And when that happens, I think people record and go back to their normal grooming patterns and get the haircut and colored and all that kind of stuff."

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