So, you want to open your first hair salon? Congratulations! As a former salon owner, I’ll offer you my perspective to assist you in moving forward. Here are a few pointers and questions before you begin your journey as a new owner.
First off, ask yourself why do I want to own a salon?
It’s fantastic if you truly have a passion for the industry, but if you think you can make a lot of quick money and pay your staff peanuts, I would reconsider.
Do you have a cosmetology and or barber license?
I recommend going to school for at least a barber license, which takes less time to attain than completing a cosmetology program. Going through the licensing process and learning this skill will give you an understanding of what your staff goes through on a daily basis, in working with clients and proper appointment scheduling. This will also gain you more credibility with staff, knowing that you are “one of them,” so to speak.
Are you going to do hair as well as run the salon?
Being a hands-on salon owner while working behind the chair is a lot of work. You have to consider the dynamics of what goes on inside the business, managing, motivating, mentoring and educating the staff constantly. If you are able to just work on the business and manage it, rather than work in the business, you may be more effective in a leadership position, and you won’t be overworked with a clientele behind the chair.
Have you ever managed people?
If you have never been in the role of leadership, management or mentorship, you may find being a salonor barbershop owner difficult. The beauty industry can be challenging because it is like no other business. For the most part, beauty professionals are creative people: they are artists. The salon atmosphere is unlike a corporate environment, where you clock in and clock out at the same time every day. Be cognizant of the types of personalities that you will be managing.
Are you familiar with the compensation structures of the industry?
Staff compensation can be a moving target in the beauty industry, and it varies from state to state. It ranges from salary, hourly, commission or independent station rental. Staff compensation can make or break your business, so know your compensation model before you open your doors. I recommend consulting with a salon business coach to review all your options. A good beauty business consultant firm is called Strategies, and it’s money very well spent.
Are you going to buy an existing salon or barbershop, or do a new build-out?
There are pros and cons to both of these. If you want to find salons for sale, you can look online. Here are a few options:BizBuySell, BusinessesForSale.com, and BizBen. If you want to purchase a building, you can try LoopNet.
Buying an existing salon or barbershop is usually the less expensive way to acquire a beauty establishment. The downside of buying an established business is that the staff working at the business may not wish to stay under new management. You also don’t know if they have any bad habits that can keep your business from flourishing. Sometimes an existing staff may even go as far as to sabotage you when you start implementing changes to the business. But you never know… you may luck out and get a great staff that will support you as the new owner. As your company grows and you need to add staff, a great resource for finding your ideal team is the salon app.
When buying a salon or barbershop, look over the lease. Have a real estate lawyer or commercial broker guide you through the lease to renegotiate it with the building’s landlord.
Make sure the seller has updated P&L (Profit & Loss) statements from at least the last three years. If you are not familiar with looking at the financial statements, get yourself a good CPA (Certified Public Accountant) to walk you through this. When you are purchasing a salon or barbershop, you are essentially buying used equipment, and possibly some goodwill. Make sure you are not overpaying for what could end up being an empty salon.
If you want to open a new salon, this also has a whole set of challenges. One is finding a good contractor. Another challenge is the permitting process through the city or town you’re located, which can take months. This is when negotiating with the landlord is crucial for the time it takes to complete the build. Again, find a good commercial realtor to help you through this process.
With a new build, you can dream big since you are designing from scratch! Like you’ve probably already heard: location, location, location! Good walk-in traffic is helpful to building a good business, but the better the location, the higher the price may be. If you don’t have a salon or barbershop designer, many times equipment companies will help you with the layout. Sometimes they will do the design for you as an incentive for you to purchase all your equipment through them. One of the companies that is a one-stop shop for salon or barbershop design is AB Salon Equipment.They have an extensive selection to choose from.
Take your time, plan your work and work your plan.
Owning a salon or barbershop takes a lot of thought and planning to do it right and get what you want, so take your time and enjoy the journey!