How to Start A Hair Salon?

Is it still profitable to open a hair salon? After all, it isn’t a new and exciting idea to get into the hair industry. At this point, you would think the market would have to be saturated. But you’re looking at a 46 billion dollar industry, holding over 1.3 million jobs in the US. Between 2013 and 2018, the hair salon industry saw 2.4% growth and has been putting up similar numbers for decades. As consumer confidence and disposable income continue to grow, more men and women have flocked to the stylist’s chair for a cut and color. Consumers are beginning to see monthly salon visits as required maintenance rather than luxury services. Most hair salons even reported that their profits were not primarily affected by recessions.

Also, to blame for the steady increase in the demand for salons is the addition of new services. Salons that offer hair modification procedures like straightening, perms, or relaxants, in house skin care, waxing, and permanent makeup stand to set themselves apart from other salons. Consumers flock to “one-stop shops” where you can run a quick beauty errand or spend the day on monthly maintenance.

To put it, opening a hair salon is a safe bet in the long term, as long as you’re ready to come up with a thorough plan. In the next installment of our How To Start A Business Series, we’re focusing in on the “shear” brilliance of a well-planned hair care business.

How much does it cost to start a Hair Salon?

There is no one simple way to answer this question, so you’ll have to break it down and do a little math. Real estate will likely be your greatest defining investment. That cost could vary significantly based on your desired location, building size, and construction variables. You can find out more about how to lower your building costs here [https://coastalsteelstructures.com/metal-building-storefront-what-developers-are-talking-about/], but for now, let’s focus on the costs specific to hair salons. Many experts agree that assuming your own space already; you can start your minimum budget for setup at $62,000. Depending on your vision for the business, this number may seem shockingly low, or maybe even shockingly high. The only way to get a more accurate price range is to define the exact type of hair salon you would like to open.

Going solo: Many stylists have long waited to go out on their own. But not everyone dreams of being “the boss.” Running a solo salon out of your small location, maybe your ideal scenario, and getting started can come with significantly lower set up costs. Some stylists have been able to meet codes and regulations for an initial investment of under $2,000. If you already own a lot, a prefabricated building can easily be customized to make your solo operation look very professional.
Franchise: Buying into a salon franchise or buying out an existing salon is a great way to guarantee a solid client base practically. When it comes to hair care products and permanent treatments, salon clients know the brand names that they trust. Many franchises require each stylist to be certified through their programs, which provides your clients with confidence and peace of mind. But this comes as one of the more expensive options. For example, one popular hair salon franchise requires that you have a minimum of $150,000 to invest for franchise fees, training, and required equipment.
Booth rentals: Creating a salon that offers booth rentals for local stylists is a great way to control your exact costs. You provide the base level equipment, including all permanent fixtures like shampoo tubs, plumbing, storage solutions, chairs, and mirrors. Stylists pay a monthly fee and provide all of their equipment. This option is also popular because it allows you to provide a wider variety of services and attract various clientele at no added cost to you. Many salons charge a monthly booth rental and enable stylists to collect their payments, while others take a percentage of all sales in exchange for a lower rental rate.

What sort of regulations and laws do salon owners need to be aware of?

Hair salons and a variety of other beauty and personal maintenance shops need to provide sanitary conditions for their clients. Opening a salon is going to subject a business owner to various levels of inspections and required licensing. The specific laws and regulations will vary depending on your location and the level of service that you provide. Researching these ahead of time will help you avoid costly fines or even a temporary shut down, so ask a lawyer or seasoned salon professional about:

Cosmetology licenses for employees
An overarching salon license
Employee Identification Numbers (this will vary if you plan on opening a booth rental operation, depending on how you choose to pay your stylists)
Building permits (check back to our article here [https://coastalsteelstructures.com/how-to-find-metal-building-contractors/] about finding a qualified contractor for your project)
Sanitation and OSHA requirements

How do you make a salon successful?

It may seem obvious, but a successful salon will start with a substantial client base. If you’re going to be calling the shots at a salon with multiple stylists on staff, your client base alone should be enough to keep the place afloat until things get going. If this seems daunting, you may want to work on your marketing before you jump into salon ownership. With your client base keeping money steadily coming through the door, you can focus more on your initial investment in educating and training staff. You’re putting your name on the door and your professional reputation on the line. Each of your stylists should be a great representation of the level of service your clients should come to expect.

Next, get creative with new ways to generate profits. Consumers are increasingly looking for ways to extend the life of their cut and color from home. It may seem like bad news for hair salons, but in reality, it’s another opportunity to increase their final bill at checkout. If you’ve decided to open a salon franchise, you’ll likely carry their products. If not, it’s up to you to choose products that you trust and educate your stylists properly. They should feel comfortable giving tutorials on how the products can be used at home to style every day.

If you’re planning on relying on a bank loan to secure your funding, here’s a helpful insider tip: research your potential locations thoroughly. Loan officers often look for business owners to have possible sites in mind that are proven to be convenient for potential clients. Keep an eye out for safe intersections with traffic lights, large parking lots, and plenty of space for signage. It may just make all the difference when applying for your loan.