In a beauty industry worth a whopping $511 billion, starting your own salon business can be a very lucrative endeavor. However, it can also be quite expensive. If you’re on a tight budget, don’t worry.
There are plenty of ways to start your salon without breaking the bank. In this article, we will discuss some tips for starting a salon on a budget.
Create A Robust Salon Business Plan
One of the most important parts of starting your own business is creating an effective business plan. Here are some tips on how to put together a successful business plan:
Conduct A Competitive, Customer, And Market Analysis
As a small business owner, you need to price your services right. Compare data on average salon prices in your area, and decide how much of a competitive edge you can afford against your competitors. This will convince potential clients that your business is worth checking out.
A customer analysis means specifying your target market, including how much they’re willing to pay for salon treatments and what percentage of the local population you can reasonably expect to turn into customers.
A market analysis will outline the marketplace in which you operate. This section of your business plan will help demonstrate why salon business is a good idea for your location. In addition to highlighting your price points and quality of service, you also need to identify how you’ll be able to stand out from your competitors.
Once you have all this information, you can devise a marketing plan within your budget. This part of your business plan provides an outline for promoting your salon once it opens.
Operations And Management
In addition to providing details on how you’ll run day-to-day operations, you’ll want to include information about employee hiring processes and employee benefits. In terms of management, be sure to outline your salon’s hiring policies and training programs.
Your business plan also needs to include a financial plan. This is where you’ll include information about how much capital you’ll need to open your salon business. It’ll make it easier for you to accurately predict income and expenditure.
Your salon business plan should also include basic financial figures, like expected revenues and expenses. You’ll also want to make a detailed budget and discuss your financing needs and sources of funds for your business.
Assess Your Financial Situation
Once you’ve created a robust business plan, it’s time to assess your financial situation and determine what you’ll need to make your business work. If you don’t have capital, consider getting a small business loan. There are several great ways to get business financing, some of them including:
Business Loans And SBA Loans
In some cases, getting a bank loan may be an option for you. There are many types of financing available, so it’s important to talk to a qualified business banker for more information.
If you’re unable to get the financing you need from a bank or other financial institutions, applying for an SBA loan could be your best option. The Small Business Administration guarantees these types of loans, so it’s easier to acquire them than private-sector loans.
Family And Friends
Your family and friends may be able to offer you some of the startup funds you need, or they may invest in your company. That said, remember that any money they provide should only be considered a loan at this point, so it’s important to have a written agreement in place.
Angel Investors And Venture Capitalists
With a robust salon business plan, you may be able to get an angel investor willing to inject funds into your business. Angel investors not only offer to finance, but they come with a wealth of information as well. However, they’ll need to have a stake in your business.
If you have high growth objectives, or if your salon is new and hasn’t been up-and-running for very long, venture capitalists may be able to help you expand your business beyond your wildest dreams.
Find An Affordable Location
The location of your business can make or break your success. Think about where you’re most likely to get traffic and what’s available in that area as far as rent and leases go. Also, stay away from expensive or too competitive areas for new businesses.
You’ll want to find a place that offers some flexibility for signage and has enough space for both your employees and clients. Finding the right place for your salon can be difficult because you want to balance cost with accessibility to your customers.
If possible, choose a place that is already fitted for a salon, such as an old storefront space. This will be much cheaper than renting and outfitting a new space from scratch.
Find Second Hand Salon Equipment
Salon equipment can be expensive, especially if you’re looking for high-quality items. This is one area of your business where it pays to shop around and find the best deals on used salon equipment. Some beauty supply stores sell refurbished chairs, tables, and other salon furniture in good condition at discounted prices.
When purchasing used salon equipment, inspect it carefully for any damage or wear and tear. Also, be sure to get a warranty or return policy if there are any problems with the equipment after you’ve bought it. Remember, cheap equipment can lead to unhappy customers and poor quality services.
So be sure that any second-hand items you buy are still in good condition before using them at your salon. You may also want to consider leasing or renting your salon furniture instead of purchasing it outright. This way, there won’t be high up-front costs, and you can always upgrade or change your furniture later on if needed.
Consider The Best Growth Options
Starting a salon business on a budget is a great way to begin, but it’s important that you don’t remain small. Instead, you’ll want to consider your best growth options for the future. Having a plan in place could allow you to start small and grow into something huge.
First, consider hiring employees. This will allow you to focus on the big picture and grow your business while others take care of your daily tasks. Once you add new employees, you’ll want to track productivity so that everyone can work smarter instead of harder.
You may even consider using a salon management software system so that you can keep track of everything. Once you open your doors, be sure to go above and beyond for your customers. This is a classic small business owner move to attract repeat customers.
Business Ownership: Starting A Salon Business On A Budget
Starting a new salon business can be daunting, but with careful planning and some creative thinking, it’s definitely possible to do it on a budget. By following these tips, you’ll be well on your way to being the successful entrepreneur you’ve always dreamed of!
If you’re looking for more advice on entrepreneurial success, be sure to check out our other articles on our website.
