Let me guess…you have a vision of a successful salon, full of happy stylists and customers who are dying to come in for services? Salon ownership has been on your mind, or maybe you are a new beauty entrepreneur.
Wherever you are in your salon owner adventure, this blog will serve as a bit of insight on how to navigate salon ownership and business operations!
Take it from someone who works with owners across the US and Canada, selling salons and recruiting salon professionals. Being a salon owner can be the most rewarding thing you have ever done, it can also be a nightmare if you aren’t prepared for what lies ahead.
Great to meet you, my name is Susan Wos, I am a former salon owner and a 28 year veteran cosmetologist. I am also the owner and founder of Salonspa Connection, here to give you the best beauty industry advice, based on who I work with, and what I see.
Being a salon owner can feel a bit like running a daycare or fighting forest fires with a garden hose! Independent owners wear many hats and reap the rewards of hard work and dedication.
Generally speaking, you will be in charge of marketing, hiring, customer services, daily operations, finances, inventory, cleaning delegation and all things management of your staff.
The type of business model you choose makes a big difference in what you will be responsible for, and how your business plan plays out. You may start out as commission or hourly, and decide to switch to a booth rental or hybrid business, later on.
There is NO RIGHT CHOICE, it’s what works best for you, and the stylists (or other beauty pros), that work in your salon.
When we dream about becoming a salon owners, walkouts, shut downs, lean financial times and getting sued by clients aren’t necessarily the first things that pop in our heads!
New salons get to sort through licensing, hiring, decor and all of the fun, exciting stuff that comes with a new business. Getting your salon cosmetology license is the easy part, people are where you will struggle the most.
Once the dust settles from opening the salon, dig into what is going on in the local area. This means: find out the easiest ways to get more customers, and figure out where the stylists spend their time.
Marketing for both clients and hair stylist employees is where you will spend most of your time and money until momentum kicks in.
When you have your own salon, this applies to having employees OR if you rent booths, you are in a people business.
With people comes joy, laughter and problems. If you are in the salon industry, you probably have a good idea about what great service customers expect from a hair salon.
But what about the people who work in your salon? Beauty pros come in all shapes and sizes- some are a joy to have on your team, and some can suck the life right out of you.
Learning effective people management is the key to being a successful salon owner. Setting clear boundaries and expectations while being kind, and sharing knowledge should be your #1 staff management goal.
Did you know that most salon owners do not write a formal business plan? 2 out of 3 salons fail in the first 5 years of being open, and only 50% of beauty businesses ever see profits that make all that hard work pay off.
Even IF you think you have it all figured out, writing a business plan helps you think through what success looks like in years to come. I personally think LivePlan is the most affordable, comprehensive beauty business plan template, available.
For some of you, a salon’s structure has already been decided, especially if you are buying an established salon. If you are unsure of which business structures works best for you, here’s a brief overview.
Commission or hourly, non-franchise salon. This model means you have employees, you pay taxes on them and need to offer some kind of benefits. These salons work well when there is a mentorship program in place new clients flow in and you like to be hands on, (or hire a manager that does).
Employee based franchise salon, spa or barber shop. These businesses work well for owners who need resources and plenty of templates to manage overhead costs.
Booth rental and salon suite small businesses. These businesses are where you lease chairs or treatment rooms to licensed beauty professionals in exchange for rent.
Hybrid salons, spas and barber shops. This models combines commission, hourly and booth rental into one thriving business.
Writing your beauty business plan will help you get your head around what finances you need to have to open the salon. If you are buying an established salon, you will already have an idea of the financial responsibility of the small business owners.
Being financially knowledgeable is the best way to invest in your brand. There are many factors that go into creating a sound budget based on your current and projected finances.
There are startup costs, ongoing costs, savings, marketing budget, staff member acquisition costs and the price of what it takes to get new customers. What you need to spend and how you should allocate funds depends on what you are starting with- new salon from scratch or buying an established business.
If you can find other businesses, similar to yours to speak with about how they budget for their successful salon, this will be helpful. Aslo, salon coaches can keep you from jumping on the latest trends and overspending on unnecessary salon equipment.
If you don’t have a specific space in mind, choosing the right location can make it EASY to tap into your target market. High traffic locations tend to be the best marketing tool- a place that makes getting clients an snap!
Choosing to build or buy a salon off the beaten path also works well, but be ready to create a great reputation and utilize marketing resources. Having your own business means making choices that can impact the success of ownership.
Think through barriers and benefits of each location before making the final decision.
If you are fortunate enough to have a partner or salon manager, creating a marketing plan should be much easier. Every successful salon I know hits all, (or most), of the places their target market spends their time.
If digital marketing is a bit out of reach at first, think boots on the ground. Things like in house makeup or botox parties, community events or just walking around and introducing yourself goes a long way!
Clients are the lifeblood of a salon. Positively effecting their self esteem is one of the best marketing tactics of all time.
When clients love you and your salon, they tell their friends and family. A referral program- rewarding one client to send another, has forever been the #1 way to grow a large customer base. By reinvesting in your clients you save paying for more ads than you need to.
I know hiring, recruiting, selling and buying salons and have a ton of great business knowledge. We also know when to refer owners to skilled money managers!
We have a list of salon coaches, consultants and mentors spanning most states, and even some from around the world. They are the best financial advisors, visit our salon consultants page to get the best money matter services!
Did you know brands only want you coming to them for products and industry business resources? It is the nature of a brand to want to captivate all of your loyalty and your money.
Most salon brands are of high quality- some will make you sign exclusive deals in order to carry them in your salon. This is an old fashioned, narrow minded vision of what today’s hair business is really about.
There is no one wrong brand to carry, just the wrong ideas around how to conduct business. Before you take products on, just check to see if they require an exclusive agreement before you do!
Inventory, back bar and supplies can really get out of control. The more you sell, the more you need to buy!
Before getting to deep, read more about salon inventory management in this blog.
For most of us, this goes without saying- people don’t get their hair done in salons they don’t feel warm and fuzzy about. A key aspect of success as an owner is a strong focus on customers.
You can have the most talented stylists, but if they don’t care about the clients, they won’t come back! The little things add up…reminder texts, refreshments and friendly faces are all part of the positive hair appointment experience!
Overall it is the responsibility of the owner to set the customer service vibe. You can’t sell products and services with a team that doesn’t value the person getting their hair done.
Do your best to meet and greet customers, before and after their visit to get a feel for how you can improve the client experience.
The reason beauty professionals leave jobs almost always comes down to poor leadership skills. This means they didn’t feel supported, heard or drama happened without the intervention of a responsible, good leader.
Polish and grow your leadership talents at all costs! This is the most important aspect in keeping people working, happily, in your business.
Focusing on your staff or booth renters does not mean you need to be a doormat. Think of it like this- the owner/ employee relationship is kinda like being in a perpetual dating mode with no chance of marriage.
If your leadership abilities are less than great, consider hiring a manager. The more help and support you have, the better off you will be.
The hair biz can be difficult and managing people is one of the toughest parts. Delegate and manage with confidence and kindness and always keep an open mind to new ideas and staff suggestions.
Creating a plan for incoming stylists- new and experienced, shows your team you take the business seriously. Without training on the way your business needs to be conducted is like hoping an airplane will fly itself.
If you struggle to create an assistant program and hire newer stylists, check in with our coaches who have ready made programs for all shapes and sized businesses.
-Susan Wos, founder of Salonspa Connection