The demand for hairdressing and beauty treatments has grown considerably in recent years. So, opening a salon could be a shrewd move if you have the right business plan in place.
To help you with the practicalities of setting up a beauty business, we’ve put together this handy Tyl Talks guide. From costs and legal requirements to equipment and name ideas, we’ll explore how to open a salon.
Your beauty salon business plan
Getting a facial may be the perfect time to lie back and daydream. But opening a hair and beauty salon might also require a hard dose of reality.
Creating a business plan for your hair salon or beauty firm could be a useful first step. This document should spell out your plans and goals – all in one place. Think of it as a roadmap that can hook in lenders or investors.
Looking to write a beauty salon business plan but don’t know where to start? Here are some things you might wish to include:
- Executive summary. A business plan for a beauty salon or hairdresser can be an opportunity to attract investment. Your executive summary is a ‘shop window’ where you could sell the vision for your salon in a snappy one-pager.
- Competitor and market research. Are there other salons that you wish to emulate? Showing that you’ve done your homework on competitors and your target market could help you kick-start your salon business.
- Key details about your salon. Your beauty salon business plan should include information about your staff, the products and services you intend to offer, and some insights into your finances, such as projected sales and costs.
- Target audience. You’ll struggle to attract customers if you’re unsure of who they are in the first place. Pinpointing the characteristics and ages of your target audience should help to improve your focus.
- Unique selling points. Learning how to start a salon business can be exciting. But you’ll need to stay realistic and remember that it’s a crowded market. With that in mind, what USPs could make you stand out and give you an edge over competitors? For example, is there a particular style or treatment you offer that nobody else does?
- SWOT analysis. Listing your strengths, weaknesses, opportunities and threats can help you prepare for the challenges of running a salon – as well as the positives.
- Marketing plan. Finding the right premises and investing in hairdresser equipment is just the start. How will you promote your business once everything is set up? You could factor things like social media marketing, a snazzy website and more traditional advertising into your business plan.
How much does it cost to open a beauty salon?
Budgeting is a top priority, whether you’re buying a hairdressing salon or setting up a new beauty business from scratch.
No two salons are the same, with manicures, hair treatments, tanning and waxing just a few of the services you could offer. Your costs may also depend on staffing levels, location, and pricing strategy.
It’d be too simplistic to give one basic figure for how much it costs to open a beauty salon. It might cost anything from £10,000 for a small start-up, to £25,000 or more. But here’s a quick flavour of some typical expenses when opening a salon.
- Salon equipment. Everything from chairs and mirrors to beauty beds and different shades of nail varnish will incur start-up costs when opening a salon. Even straightforward services such as manicures and pedicures may require equipment costing hundreds of pounds.
- Licences. There are different fees payable to your local authority depending on the types of beauty treatments you plan to offer. For example, laser treatments may require a more expensive licence and extra permissions. Your local authority might have a resource for special treatment licensing – simply search on the Gov.uk website.
- Business rates. This is a form of tax on commercial properties, including beauty salons. Learn more about these rates.
- Business taxes. You may be liable for Corporation Tax. And you might need to submit a VAT return too. Find out more about business taxes.
- Rent. Comparing the rents of different premises should help you strike the right balance between location and cost.
- Transport. Starting a mobile salon may save you money on rental fees. But you’ll need to add up the costs of buying and maintaining a vehicle, plus things like servicing and fuel.
- Wages. Hiring specialist talent can expand your list of services in an instant. However, you’ll have to think carefully about the salaries you can realistically afford.
- Day-to-day business costs. Like any high street business, running a salon means paying for utilities, insurance, phone systems, a website, and managing a payroll.
What equipment do you need?
Equipment is a key cost when exploring how to start a beauty business. And with so many gadgets and tools available, it’s easy to go overboard.
A tight checklist should stop you from buying beauty and hairdresser equipment that you don’t really need. Here are some common items to consider, alongside more specialist equipment.
- Gowns, towels and aprons.
- Brushes, scissors and blades.
- Styling chairs and treatment beds.
- Mirrors and sinks.
- Shampoo, dyes and styling products.
- Hairdryers, straighteners, dyeing equipment and facial machines.
- Welcome desk, phones, payment machines and computers.
- Seating and furniture for your waiting area.
The exact equipment you’ll need might also depend on your business model. For example, some salon owners rent out chairs to stylists for a set fee or a percentage of their takings. These workers may bring basic tools like scissors and hairdryers with them, potentially saving you money.
Legal requirements for a beauty salon
As well as costs, it’s vital to weigh up the legal requirements for a hair or beauty salon in the UK before getting started. Common issues can include:
- Premises licences. Treatments like massages, sunbeds, electrolysis and chiropody may require a special licence, depending on where you’re based.
- Health and safety compliance. You’ll need to keep your premises and equipment clean and hygienic to stay within local byelaws. Salon owners should also consider the effects of potentially harmful chemicals.
- Insurance. You might be legally required to purchase employers’ liability insurance if you directly employ staff.
- Qualifications. You may need specific qualifications to safely perform procedures. Having NVQ diplomas and certificates could also build trust among your customer base.
- Tax and accounting. Salon owners will need to register with authorities like HM Revenue & Customs, ensuring tax is reported correctly and paid on time.
Beauty salon name ideas
Names for beauty salons can be difficult to think up. But most would agree that they matter, as first impressions count. Salon names can be snappy and playful. However, they also need to be relevant – instantly explaining what your business does.
Here are some things to consider when shortlisting beauty salon name ideas:
- Does the name clearly explain your services? Clever puns may be tempting but might confuse customers searching online or walking by in the street.
- Will it support your wider marketing efforts? A strong and engaging name could make your salon much easier to promote.
- What words are associated with the industry? Since salons are places of relaxation, words like ‘indulgence’ and ‘elegance’ may be more appropriate. It’s best to avoid anything that implies discomfort.
- Is it relevant to your audience? Ensure the tone of voice is right for your target customers. Do you want something sophisticated, which may imply an upmarket salon? Or something modern and fun to appeal to a younger crowd?
- Does it roll off the tongue? A name that’s short and easy to pronounce could make it easier for customers to spread the word and even pay over the phone.
- Is the name easily searchable? You may wish to consider search engine optimisation to boost your chances of being found online.
- Will you stand out from competitors? Try to avoid names for beauty salons that are too like existing businesses.
- Have you spelt each word correctly? It might sound obvious, but there are plenty of apostrophe catastrophes out there.
Marketing your hair and beauty salon
Once you’ve learned the basics of how to run a salon, it’s time to spread the word. Your size and budget will influence your marketing efforts. Here are some popular options for inspiration:
- Professional website. A well-designed website can set the tone for your brand, while answering customer queries about your services, prices, opening hours and location. You could take things a step further by optimising it for search engines and mobile users.
- Social media. Regular updates on apps like Instagram and TikTok could generate a buzz around your brand. News of special offers and colourful photos can help to grab people’s attention.
- Email marketing. Regular emails can keep customers interested, whether you’re sending details of a new treatment, providing testimonials or promoting one-off discounts.
- In-store branding and promotions. A carefully crafted logo could help your brand stick in the minds of customers. Special offers and perks like free coffees may also increase word-of-mouth recommendations.
- Review sites. Monitoring online reviews should offer valuable insights into what your customers really think. Actively responding to positive – and negative – feedback might also enhance your reputation.
Taking payments in your salon
Of course, the best-laid beauty salon business plans could go to waste if you’re unable to take payments.
In a digital world, customers have high expectations when it comes to payment options. While cash and Chip and PIN still have an important role, you may need to research contactless and mobile payments too. What’s more, online and phone payments could provide extra flexibility. It’s all about giving people a choice.
Offering a wide selection of payment methods should also save you time and effort when opening a salon. For example, a portable card machine will accept payments from different areas of your salon. So, your customers could pay from the comfort of their chair. Meanwhile, innovative point-of-sale systems could link card transactions to other parts of your business such as inventory and customer management.
Launching any small business is a leap of faith. And salon owners have plenty on their plates, from equipment costs to health and safety compliance. Yet learning how to run a salon successfully doesn’t have to be a chore. Whether drawing up a business plan or deciding on a name, a bit of organisation and advance planning should keep you on the right path.
This has been prepared by Tyl by NatWest for informational purposes only and should not be treated as advice or a recommendation. There may be other considerations relevant to you and your business so you should undertake your own independent research.
Tyl by NatWest makes no representation, warranty, undertaking or assurance (express or implied) with respect to the adequacy, accuracy, completeness, or reasonableness of the information provided.
Tyl by NatWest accepts no liability for any direct, indirect, or consequential losses (in contract, tort or otherwise) arising from the use of the information contained herein. However, this shall not restrict, exclude, or limit any duty or liability to any person under any applicable laws or regulations of any jurisdiction which may not be lawfully disclaimed.