How do places like Snip Avenue make money, given they charge ~$3.80 for a haircut?

If you have frequented enough places that promote haircut at $3.80 or $5 you will notice that most of these salons will try to engage in the following tactics to earn more money from you.

1. Upsell - they will sell you packages like $38 for 10 haircuts or $50 for 10 haircuts. Because at any point in time, there are always "unredeemed" haircuts which means that these hair salons can capitalise on future earnings in some sense.

2. Cross-sell - they will sell you other services like hair colouring, wash and blow, hair scalp treatment, hair care products which can sometimes cost hundreds of dollars.

To tie everything together, when these hair salons lock you in for 10 haircuts, it provides them plenty of opportunities to up-sell and cross-sell you the abovementioned. The basic hair-cut is just a bait, the real money is made from the other haircare services and sale of hair care products.​​​

I did not look into this but for stores that charge really low for services, their business model revolves around getting large volume.