“Quick summary” If you want to establish a new business, specifically a salon, you're in good company: The beauty business is valued at more than $56 billion per year, with hair care being the most profitable component, with 86,000 facilities nationally.
But what exactly will it be? A full-service beauty parlor or spa, or perhaps a hair salon, nail salon, or barbershop?
This is sure to be an important read for you regardless of the type of salon you own. Despite inflation in 2023, the salon sector is growing at a breakneck pace. There has never been a better moment to open a salon than now, since people are spending an increasing amount on their beauty and hair-care needs.
But let's get right to the point. Even now, a lot of salon enterprises fail, and the primary cause of salon startup failure is inadequate planning.
Don’t worry, we have compiled a detailed checklist on how to open a salon for your rescue. It includes a step-by-step guide.
So, without any further ado, let’s get started.
In this competitive time, starting and managing a successful business is not easy. But, a quick and concise checklist always comes in handy and helps you get started with the business.
Let’s find out what a quick salon business startup checklist looks like:
By simplifying the process and focusing on these steps, you can lay a strong foundation for your salon's success.
Writing a salon business plan is among the most crucial phases in opening a salon. The plan provides you with a road map to follow and, if necessary, to present to funding sources to secure funds for your firm.
The following sections ought to be included in your business plan:
The cost to start a salon business can fluctuate extensively based on location, dimensions, salon type, and the number of customers, staff, and equipment required. On average, the initial investment can range from $50,000 to $250,000 or potentially surpass.
Let’s find out about the comprehensive cost breakdown to start a salon business:
|Estimated Cost Range
|Salon Space and Renovation
|$20,000 - $100,000
|Furniture and Equipment
|$10,000 - $50,000
|Supplies and Products
|$5,000 - $15,000
|Licensing and Permits
|$1,000 - $5,000
|$1,000 - $3,000
|Professional Staff Recruitment and Training
|$5,000 - $15,000
|Branding and Marketing
|$3,000 - $10,000
|Website and Online Presence
|$1,000 - $3,000
|Booking and Scheduling Software
|$500 - $2,000
|Utilities and Rent
|Variable (monthly expenses)
|Grand Opening Promotion
|$1,000 - $5,000
|$2,000 - $10,000
|$2,000 - $5,000
|Working Capital (3-6 months)
|Variable (to cover operating costs)
Total Estimated Cost to start a salon business: $50,000 - $250,000 or more
For you to start a salon business, you will normally require many licenses and permissions to assure legal compliance and operation. The exact prerequisites can vary based on your location and the services you intend to offer. Nonetheless, here's a comprehensive yet general catalog of licenses and permits you might need:
You can connect with a leading law professional, who can understand your business needs and offer the right solutions accordingly.
Location—where it all is. The most crucial element for a salon business is this.
Is the location of the salon as crucial as it formerly was, though? You won't be as reliant on foot traffic if your salon has a significant social media following. Instead, your salon gains exposure and draws in customers online.
The location of your salon is still crucial, though, even if you establish a strong internet presence. Your location conveys a lot about you and it should be relevant to the type of salon and audience you are targeting.
And it should be easy for your target client to find you. Salons that are situated in areas where a lot of people drive or stroll by also need to spend less on marketing. Because of the location, they get that for free.
However, choosing the ideal salon site involves considerations beyond client comfort and traffic patterns. It also covers additional relevant details like parking facilities, area type, rent or cost of site, and locality. So, never, ever skip or overlook this factor.
You've just taken up the keys to your new salon premises and signed the paperwork.
One of the initial steps for a thriving salon business is to furnish your vacant space and procure the essential equipment needed to get started.
Amidst the enthusiasm of acquiring new items like furniture and decor, remember that each element comes with a substantial cost, urging considerable financial consideration.
A significant amount of your initial spending will go toward salon equipment, and many owners tend to overpay. Make a basic inventory of the supplies your salon will need and ask from different suppliers to get the best price. Also, don’t compromise on quality at all.
These are equipment necessities for any salon:
Most salons feature one salon station for each employee, however, hair stylists with opposing work schedules may be able to share one. The amount of equipment needed is determined by the size of your salon as well as the number of employees you intend to hire.
Hiring your dream team is critical not just for the profitability of your salon, but also for the entire dynamic of the workplace. When employing new hairdressers, take your time and thoroughly screen them.
Let's talk about protection: having insurance is mandated by law. Depending on the state, you may be required to carry different kinds of insurance.
If you need assistance with the process or are puzzled, get in touch with the top insurance provider or an expert.
It's critical to build a marketing strategy before opening a salon that will increase brand recognition, attract new clients, and build a loyal customer base. To effectively market your salon business, you should employ a combination of both offline and online strategies to reach a broad audience and engage with potential clients.
Here are various marketing ideas for your salon business:
Pro-Tip: Remember to track the effectiveness of each strategy and adjust your marketing plan as needed to maximize your results.
Phew. A long one. But, it is full of information and a comprehensive guide to starting a salon business. We just hope this article has covered what you need to know on how to open a salon business and even manage it in the best possible manner.
FYI: the cost to operate a salon can range from $100,000 to $200,000. This figure will change based on several factors, including the size, location, and upgrades of your salon.
We know, it’s a significant step to open your hair salon, but it can also be quite fulfilling. You must prepare yourself by conducting your research and creating checklists before making any significant financial decisions or investing any money.
When starting a salon, careful preparation, a well-defined budget, and an effective marketing approach can make all the difference. The most crucial thing you can do is dedicate time and energy to maintaining your salon from the beginning.
And, for effective maintenance, get your hands on a best-in-class and feature-rich POS system. If you are looking for one, OVVI’s POS system has the relevant features to easily streamline the operations of your salon business.
So, what are you waiting for? Connect with us & discuss right away!
With a predicted growth rate of 7.55% throughout the forecast period, the size of the worldwide salon services market is expected to increase from its estimated value of USD 215.65 billion in 2022 to USD 383.88 billion by 2030. The salon sector in the United States contains over 80,000 locations with a combined annual sales of approximately USD 532 billion.
However, the revenue earned by a salon business might vary depending on a variety of criteria such as location, size, services supplied, and customer base.
An average salon turns a profit of $19,100 annually. The average profit margin for salons is 8.2%, which is higher than the 7.7% average for all businesses and is rising yearly. The profit margin of a salon might vary from 2% to 17%, contingent upon the level of management attained.
The primary source of income for hair salons is service revenue. In the US, this makes up approximately 92% of the revenue made by the average hair salon. Additionally, retail sales account for a meager 8% of total revenue.
This is an average image. The most prosperous salons have found that adding this service to their core service offering is profitable, thus they usually have a larger share of retail sales—14–18%.
Starting a small salon business at home presents an amazing opportunity with higher revenues and reduced overhead expenses. Embarking on this venture demands meticulous attention, professionalism, and a steadfast dedication to delivering top-notch services.
Here's a streamlined guide to start your small salon business:
Note: Make sure to provide excellent customer service, build a loyal client base and increase the retaining of customers. Satisfied clients are more likely to refer friends and family to your home salon.
After your salon opens and you have your first 30 to 40 clients, you should push yourself to the limit to maintain momentum and grow your business. Opting for the best point-of-sale (POS) system is a judicious decision for optimizing your business. However, various POS systems exist to help in efficiently handling daily tasks and managing your salon operations.
Note: Make sure to choose the right and feature-rich POS system for your salon business.
Obtaining a cosmetology license and making sure it is clearly visible in your shop for customers and inspectors should be your priority as a prospective salon owner. Training can take several months.
While attending beauty school might be costly as well, there are alternative ways to obtain your license. To gain experience and gain the knowledge required for an exam, some individuals aspiring to become cosmetologists may choose to work as apprentices at another establishment.
Obtaining a license in cosmetology and salons can be costly. It can sometimes cost around $12,000. If you're just starting, you should concentrate on earning your license rather than trying to open a salon.
Salon businesses are among the most competitive and saturated businesses. So many salon businesses fail because of the following reasons:
But, don’t freak out. Being a salon owner is a lucrative business that draws in a lot of entrepreneurs. But make sure to plan well, forecast your future well, and cope with the trends to maintain a competitive edge in terms of pricing, services, and general customer care.