The beauty salon industry in the United States is continuing to show healthy growth and was worth over sixty-six million dollars in 2019, so it is no surprise that there is an increase in new beauty salons opening up.
If you are planning on opening a beauty salon yourself, it will take lots of hard work, planning, and research so here are seven pieces of advice that will make the process less stressful and help you to set up your salon for success.
1. Create a Business Plan
The key foundation for any business is a solid plan and beauty salons are no different. The salon industry gurus with Chairs That Give highlight the importance of a carefully written business plan detailing who your customers are and how their needs and wants will be met whilst staying within a budget and generating enough sales to be sustainable. A well thought out business plan typically includes:
– Executive summary. An overview consisting of your mission statement, and descriptions of your location, products, services, and team.
– Company description. This should detail the services offered and any competitive advantages that differentiate you from other local salons.
– Market research and analysis. Researching the beauty market and what your competitors are doing is vital to identifying your target customers and offering the right products and services.
– Organization and structure. Provide information on your business structure including profiles of each team member detailing their strengths, experiences, and why they benefit your business.
– Products and services. Write descriptions for everything you sell and break down the costs and profits for each item.
– Marketing and sales plans. Firstly, create a profile of an ideal customer so you can identify which demographics you will target with your marketing in terms of age, gender, income, location, and occupation. Next, detail your plans on how to reach customers by specifying which advertising channels and marketing tools you will use.
– Financing and projections. Listing every cost associated with operating your business and the sales required to cover overheads and turn a profit is vital to getting funding for your business and making sure it survives. Some of the documents required are budgets, profit and loss sheets, and cash flow statements.
2. Calculate the Costs
As mentioned above, a key part of a business plan is working out how much money is required to set up and operate your business. At this point, you should start by listing down all your expected upfront costs such as budgets for equipment and renovation, in addition to your operating costs which typically include insurance, inventory, payroll, rent, and staff training.
After detailing all the costs, you will need to calculate the right price to charge customers that offer both good value and a sufficient profit margin. When it comes to beauty products the standard markup is 50% whilst spa services also follow a universal pricing trend and the best way to price services can be by investigating what competitors charge.
3. Get Insurance
In many states, business insurance is mandatory under law, although the peace of mind it provides makes it worth getting. The majority of businesses get insurance policies for their properties and to cover any potential liabilities claims due to personal injury or property damage.
4. Choose the Right Location
The location of a beauty salon plays a big part in its success, generally, salons that are located centrally in a district, city or town will do better as they get lots of foot traffic. When deciding on a location you should also consider setting up near other relevant businesses and researching where your target audience lives so you can find somewhere convenient for them to get to.
5. Invest in Marketing
Letting your target customers know about your salon is imperative to its survival, so creating a marketing plan is a must. There are many parts involved in a marketing plan, however, it should define your target audience and detail how you will reach and retain them as customers through the use of different marketing tools which could include:
– A professional website that can take bookings – Yelp listing – Social media adverts – Loyalty programs – Referral discounts – Creating a YouTube channel – Placing posters in regular frequented locations – Promoting your products and services at events – Use an e-mail campaign – Attractive, logical, and consistent branding
6. Research Local Laws and Regulations
To be fully legal, every beauty salon should ensure it is following regulations and laws relating to business licensing, health and safety, fire safety, sanitation, hazardous chemicals compliance, labor rights, and tax which should be also be detailed in a business plan.
7. Customer Service and Hiring Staff
Another key part of developing a solid business plan is making sure you have hired the right staff that can be depended on to consistently deliver an excellent customer experience that clients are likely to review positively and tell their family and friends about.
Opening a new beauty salon definitely takes a lot of dedication, financial resources, and hard work, however, you can save yourself from stress and avoid some common pitfalls if you read up on advice and plan carefully.
Tags: beauty salon, Business Plan, Chairs That Give, chairsthatgive, Costs, Customer Service, Hiring Staff, Insurance, Local Laws, Market research, Marketing, Opening A Salon, Regulations, Right Location
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