If you’ve been dreaming about taking your talent for beauty to the next level and opening your own salon, now is the time. People like to look and feel great, even when times are tough. The beauty industry is worth over $500 billion each year, so starting a beauty salon can be a wonderful investment.
But how should you go about it? Where should you begin? And what do you need to start a beauty salon?
In many ways, being a beauty salon owner is like being any type of business owner—the keys to success are the same.
You’ll need to do your research on how to start a beauty salon business ahead of time, which requires:
- Creating a business and marketing plan
- Familiarizing yourself with local laws and regulations
- Determining where you will perform your services
- Securing financing options for your business
There are many ways to finance and start your beauty salon business, but remember that small business equipment leasing solutions like Clicklease can help you avoid a large upfront investment.
We’ll go into more detail in our 7-step guide, but first, let’s examine the costs.
How much does it cost to start a beauty salon?
You’re taking steps to make your salon ownership dreams come true, including establishing how much this will cost. We detail many of the average costs below, but estimates range from $15,000 to over $100,000. That’s quite a range.
When putting together a budget to start your salon, consider the following factors:
- Monthly fixed costs—Insurance, equipment, utilities, and rent
- Monthly variable costs—Labor, products, advertising, shipping, and delivery
- Forecast revenue—Your revenue for the entire first year
- Break-even point—The point when expenses and revenue cancel each other out
- Budget—What you can afford to spend on various costs
Reducing beauty salon costs
Sounds like a lot, doesn’t it? Don’t worry, you can reduce your costs as you work on getting your salon up and running. Here is a list of tips to minimize your salon expenses:
- Reduce over-staffing: Overemployment will increase company expenses, so only hire stylists as you need them, or as you need to grow.
- Control your inventory: Determine which products will likely generate more sales, then minimize your inventory to reduce company costs.
- Assess quarterly expenses: For each quarter, determine areas where you spent too much money and work on reducing those expenditures for the next quarter.
- Encourage pre-booking: By encouraging customers to schedule in advance, you’ll better understand how many employees you’ll need for certain shifts.
- Sell online: Instead of spending extra on inventory to keep in the salon, consider selling some of your products online.
One solid way to control your company budget without overspending is by leasing your equipment through a small business leasing solution, like the one Clicklease offers. Our simplified payment offers allow you to fund the equipment you need for your salon services without stretching your budget.
7 steps to start a successful beauty salon
What do you need to start a beauty salon? As you’ll soon find out, a lot goes into establishing and maintaining a successful salon enterprise. Let’s break the process down into manageable steps so you can move forward confidently.
1) Create a business plan
Create a road map with steps to follow and topics to research.
- Think about your customer base.
- Figure out your value proposition.
- Become familiar with your competitors.
- Determine your services and location of operation.
- Secure financing for your services and essentials.
- Develop a marketing plan to increase business awareness.
The last point is crucial. Think about marketing initiatives you can take to increase brand recognition. Find out which social media sites your customers are most active on and create quality content while engaging with them regularly.
If your budget allows it, create a professional website that highlights your salon, including its services, offers, and customer reviews.
2) Understand local laws, ordinances, and regulations
Laws that apply to salon owners vary depending on where you live and what type of salon you want to own. However, you’ll need an operation license regardless of the state you’re in. Do you plan on providing hair services only? That will require different licenses than a salon that also offers waxing, nail services, or lashes.
To give you a basic idea, here’s a sample of the requirements you’ll have to meet as a salon owner:
- Salon and/or cosmetology license
- Building permit
- Insurance
- Sanitation permit
- Employer identification number (EIN)
- OSHA regulations
If you’re leasing or renting out a space for a beauty salon, follow the lease agreement guidelines provided to you. The details of your agreement will vary depending on who you rent your salon suite from and what conditions that party has established.
You’ll also need to figure out whether or not your current lease permits you to offer additional services, including nail treatment, pedicures, and cosmetic treatment.
3) Secure financing
You’ll need to secure financing for furniture, appliances, and other salon products. Ask yourself questions that will help you determine how much funding you will need, including:
Where will your salon be located?
Compare and contrast different sizes in different areas. Plan to pay a security deposit as well as the first and last month’s rent upfront. You can expect to pay between $40,000 and $250,000 for an established salon or anywhere from $100,000 to $500,000 to build one.
What kind of equipment do you need?
If you’re wondering, “what do I need to start a beauty salon,” there’s quite a bit. A full beauty salon will require around $27,000 worth of equipment. The larger items you’ll need include:
- Chairs
- Sinks
- Mirrors
- Dryers
What if you can’t afford larger-scale items like salon chairs, sinks, lighting, and booths? In that case, consider leasing the equipment instead of buying it. Your down payments will likely be lower, and you’ll receive personalized payment solutions that fit your company’s budget.
List of supplies?
The start-up cost for initial supplies can cost $20,000 or more. Take note of the smaller items you’ll need, such as:
- Shampoo, conditioner, styling products
- Scissors, pins, and brushes
If a loan is not the solution you want for funding the equipment you need, or maybe you are facing limitations that won’t allow you to secure a loan, consider Clicklease.
Our customers love us because we provide affordable financing options for equipment like salon chairs, mirrors, and tables. This way, it’s easier to manage your money for the little things. Clicklease will also benefit you in ways that include:
- Providing flexible payment plans
- Providing big or small purchases/leases
- Helping you become eligible for unique tax benefits (please consult with your tax advisor)
4) Build your client base
As you grow your salon, think about ways you can increase customer loyalty. Making your clients a priority will ensure they become repeat customers who will recommend your services to their friends and family, thus increasing profits.
One way you could nurture your client base is by ensuring your salon is fully-stacked with all the equipment it needs. If you lease your equipment, not only will you save money up-front, but you’ll have all the essentials you need to help grow your client base right away.
5) Hire and train a top-tier staff
Invest in quality training so your staff understands how important they are to your company’s objectives. Your stylists and technicians are the faces of your business. Make sure they feel comfortable with your products and other treatments, so the clients will be too. Also, consider affordable outside vendors for services like scheduling, payroll, taxes, etc.
6) Focus on your client experience
Now is the time to create your vision for your client experience. How do you want them to feel? How can you provide a fantastic experience that stands out from the competition? Well, there are a couple of ways.
You can seek valuable and informed feedback from current customers and use it to improve your services. Use the insights you gain to develop a business strategy that addresses shortcomings and areas for improvement. Ask yourself how you will improve your services and exceed client expectations.
Finally, invest in quality equipment so you can focus on streamlining productivity and delivering exceptional services that stand out from your competition.
7) Charge accordingly
How much should you charge for your services? You don’t want to set prices too high, yet you also don’t want to undervalue yourself. This can be a tricky part of the process and might involve some adjusting as you go.
Research your area and find out the average charges for someone with your level of experience and training. The median pay for barbers, hairstylists, and cosmetologists is $29,680 per year, but as you develop your skills, your charges should reflect your level of expertise. Use this information to determine a fair price.
Make your salon ownership dreams come true
These seven steps provide a great launching point for making your dreams a reality. Starting a beauty salon can give you a rewarding, meaningful, and creative career.
Include Clicklease in that process today by applying for easy equipment leasing with instant decisions.
