Healthcare, Retail

How To Set Up A Beauty Parlor Salon | Hair Studio Business

The Art Of Beauty

There are various salons and spas on almost every street corner in all US cities and towns. Many are attracted to this industry by the apparent glamor of running a salon business. But don’t be fooled; it is an excellent business with many opportunities but it is intensely competitive and requires much hard work to reach success. What is sometimes not mentioned in conversation is that many salons close yearly because the owners were simply unprepared. But for those who put in the leg work and do their homework, the salon or barbershop business is an excellent venture offering independence, flexibility, and a good income. If you are thinking of opening a salon business, here are some practical tips

The Salon Business

The salon business is much more than cutting and trimming hair. Understanding the tricks of the trade is valuable. It is vital to be licensed and have prior experience in a salon before opening your hair salon or barbershop business. Take an online course in hairdressing or sign up for classes, and eventually, you’ll be able to take your state board exam to become a licensed cosmetologist.

Once licensed, try working in a salon to learn the profession’s business side. Also, there are many specializations you can pursue, including but not limited to the barbershop experience or color treatments; this will help you understand more about what you want to do, what the customers want, the tools of the trade, and daily issues.

A Salon Is A Gallery

A salon is like an art gallery, where works of art and beauty are performed on clients. Ranging from but not limited to;

Massage.
Haircare.
Skincare.
Pedicure and manicure.
Makeup.

What Will I Charge For My Hair And Beauty Services?

Because of intense competition, your prices will need to be reasonable as you build your company. Try visiting local salons in your area to determine what they charge. Remember, though your customer is always looking for low prices, you don’t want to make them too low as it may suggest that you offer poor services.

How To Encourage Clients To Return

Keep the place meticulous at all times
Be courteous and friendly
Offer free scalp and hand massages
Play gentle music in the background
Offer good reading material
Offer free wifi
If possible, offer free coffee and tea

Hair Studio Business Plan

Without question, you will need to make a concise business plan before opening any company. The business plan will help provide insight into the business and mitigate any issues in the future. The business plan should consist of the following:

What are the startup costs for a salon?
What will I name my salon?
Where will I set up my salon?
How big will my salon be?
How many employees?
What appliances do I need for a salon business?
What are the difficulties encountered in a salon business?
Where will I obtain funding?
Who is my competition?
How much profit do salons make?
How can I market my salon?
What other services can I offer to make the salon profitable?
What is my maintenance budget?
What salary will I offer my employees?
How much will I charge for the services?
Do I need a license or permit to open a salon?
Do I need to hire an attorney?
What supplies will I need for my salon?
Who are my customers?

The more detailed your plan, the less likely you will encounter future issues. Plus, the lender will ask for your business plan when you apply for funding.

There are some handy services available online

Some business plan templates that you should consider include:

If you have not made a business plan before, some websites can help.

BizPlanBuilder: The most user-friendly
Business Plan Quick Builder (has many accessories)
Business Sorter: Best for internal plans
Entrepreneur Business Ideas – Tools & Tutorials (comprehensive)
GoSmallBiz.com: Most extra features
LivePlan: Best overall
Wise Business Plans: Best professional service

Your Salon Company Administrative

A business license is essential if you want to operate a salon. You should visit the local Chamber of Commerce and determine what other permits and support you need.
All hairstylists and cosmetologists who serve clients will require a license.
Building permit
Fire and Safety Permit
EIN business ID number
Meet OSHA requirements
Register for state and federal taxes

Salon Business Incorporation

Check out these few companies that can assist you in getting your LLC started.

Here are a few government links you might want to visit

IRS Website

This site by the IRS is a must-see when beginning your LLC

Salon Business Insurance Cost

Insurance is essential for a salon because you’ll deal directly with clients and employees. You’ll be required to purchase insurance to cover theft, vandalism, fire, and liability. Also, if you employ more than two workers, you must get workers’ compensation insurance.

Here is a list of some standard insurance companies

Biberk
Beauty & Body Work
Beauty Insurance Plus
Three Insurance (Berkshire Hathaway Company)
Next Insurance
Thimble
Geico
Insureon
Mercury Insurance
Allstate
Farmers Insurance
Huckleberry
State Farm
Hiscox
Nationwide
The Hartford
Travelers-Business Insurance
Liberty Mutual
Progressive Commercial

Best Places To Get Small Business Insurance

What Are The Startup Costs For A Hair Studio?

Your startup costs depend on many factors, including the following:

Rent
Salary for employees
Utilities
Insurance
Supplies
Furniture
Appliances

Salons require a decent amount of space because several people will need to work simultaneously. The rent for a salon can vary from $ 3,000 to $8,000 a month. Equipment and supplies can easily cost $10K-$15K. So, your startup costs for a salon vary from $50K-$100K

Financing For My Salon

Generally considered high-risk ventures, lenders are often hesitant to offer loans for salons. It would be best if you had a solid business plan before you visit a lender. Besides that, your credit score must be in good shape, and you should not have any significant debt.

Small business loans are available through credit unions, but the amount of money loaned is not huge, and the application process is very bureaucratic. Loans of $50K are possible if you have a good credit score.

These also come with much higher interest rates and administrative fees. If you do not have enough money to buy the equipment, you can lease it. Leasing will reduce your initial investment costs. Some leading companies also offer opportunities to buy your equipment at the end of the lease.

Salon Funding

Here are a few of your options

Small Business Administration

The Sma ll Business Administration, SBA has a program to fund new startups and is worth a look

Salon Business Banking

Here are a few of the standard business banking options available online

Salon Staff

The salon business has a high staff turnover; the critical reason is that many individuals move away to set up their own businesses after a couple of years. So when you hire, you need to keep that in mind. You preferably want someone already trained or with experience working in a hair salon. It would help if you employed pleasant, easy-to-work-with, and trustworthy staff. You may want to register with an employment agency to ensure that you use good, reliable hairdressers. It is best to avoid very young people because they tend to be unreliable and often resign abruptly.

Beauticians.
Barbers.
Hairdressers.
Salon assistants.
Manager/ front desk personnel

Staffing agencies that you may want to use:

Cosmetology Board Certification By State

Salon Business Training

When you finally open your salon, take it easy. Even though you may have grand visions of success, the salon business can be demanding. It takes time for the company to become well-known. Don’t start investing massive amounts of money into new appliances and too much staff because there is no guarantee that you will have enough clients every day to pay for it all. Once you have established, you can start the process of further investment.

How Do I Market My Salon?

Before you decide to open your salon, you should consider doing some marketing. If you have worked in a salon before, tap into your old customer base and tell them where you will be operating.
Create a website featuring your location and contact information. Keep the website active with lots of colorful images of your satisfied clients. Showcase your services and mention any discounts that you will be offering
Be active on social media; post all about your salon and services. Regularly post photos of your services on social media.
Create a flyer and distribute it in the local community
Participate in local community events like school meetings, children’s activities, etc., and pass the word about your business
Partner with other small businesses like a pharmacy, spas, or hair replacement centers to help widen your reach
Create incentives for loyal customers like discounts, promotions, and coupons.

Where Should I Open My Salon?

The most critical aspect of opening a salon is the location. It would help if you had a central location but some distance from your local competition. Foot traffic in this location should be heavy, and the area should be easily accessible.
Also, ensure there is ample parking.
Because seniors regularly get their hair dyed, cut, and trimmed, you should ensure that your salon is near a senior facility and allows easy access.

Here is a list of some popular commercial real estate companies:

Can I Rent Out Salon Space?

Many salons that are not too busy will rent out a booth or a chair to a professional hairstylist. The booth rental fee varies from $300 to $500 a month.

Each hairstylist should have 8-12 clients a day to be successful.
In general, the net profit for a salon varies from 10-to 15% of sales.

How To Encourage Clients To Return

Keep the place meticulous at all times
Be courteous and friendly
Offer free scalp and hand massages
Play gentle music in the background
Offer good reading material
Offer free wifi
If possible, offer free coffee and tea

Salon Business Equipment

Appointment book
Computer, printer, and fax
Contactless card reader
Phone
Stationery
Tip jar
Disposables like paper towels, gloves, aprons, and capes
Retail products which customers can purchase (shampoos, dyes, conditioners)
Teaching guides for staff
Uniforms

Salon Pro Inventory Management and Point Of Sale

How you track and manage your inventory can make or break the venture. There is a wide range of inventory management software available on the market. On that note, we’ve got you covered.

Cash payment
Debit and credit card payment
Redeeming coupon/ bonus points
Electronic payments

Payment methods have to be secure, swift, and, you guessed it, Simple. Mobile Point of Sale is the way to go for a modern salon, and we strongly recommend Square. Care to know why? Simplicity. If you want to worry less about the complexity of setting up payments infrastructure and see payments show up in your account?

Depending on the size of your business, you might want to check out some handheld computers to speed up the inventory management process.

Accepting Payment has to fit the customer’s lifestyle and be seamless. We have a wide range of options, from a mobile point of sale (mPOS), cloud-based POS, on-premise POS, and even cash registers. You might be running in circles without reliable software that tracks payment and cash inflow. For convenience, all payment platforms should be available to clients.