Nail salons are poised for Starbucks-style expansion after decades of being overlooked by investors, according to the boss of the UK’s largest luxury chain, following a £130 million valuation.
Townhouse, which runs 40 luxury nail salons in the UK, plans to open hundreds of new franchised sites after securing investment from Cartesian Capital, the US private equity firm behind Burger King and Tim Hortons in China.
This new backing will accelerate the growth of the business, founded in 2018 by Juanita Huber-Millet and led by her husband and chief executive Jonathan Millet.
Mr. Millet said the nail care industry is at a turning point, being highly fragmented and historically under-invested compared to other service sectors.
“I think there is probably an element of beauty services overall being overlooked,” he told the Press Association.
“I would say there is a little bit of an element of, historically, 20, 30 years ago, finance and capital being very dominated by men, and this being a sector that primarily serves women.
“So if you’re a male private equity investor maybe 15 or 20 years ago then maybe it wasn’t front and centre of your mind as something to invest in.”
He compared the nail salon industry to sectors such as coffee houses, hotels, gyms, and sandwich shops, which have all grown through chain expansion in recent decades.
Other beauty salon services like waxing and massages have begun to grow with brands offering a “Starbucks-esque experience” after years of the beauty industry lagging behind.
Currently, there are no major nail salon chains in the UK, with Townhouse entering a market dominated by independent and boutique shops.
Mr. Millet also highlighted issues in the nail industry, including poor working conditions, lack of employment contracts, and even cases of modern slavery.
“In our industry there has historically been quite a lot of exploitation of workers,” he told the Press Association.
“When Covid hit, there were a lot of people in the industry who didn’t have contracts, who were just being paid cash in hand, so they didn’t get government relief.
“And we still see a lot of people, as we’re recruiting, who have worked in the industry and not had contracts – all the way through to, less pervasive but there, some elements of trafficking and indentured labour.”
Townhouse says it offers its nail technicians above-market pay, private healthcare, paid leave, and structured career progression, including in the US, where it currently operates a handful of stores.
