business plan template for booth rental salon

Booth Rental Salon Business Plan [Sample Template]

By: Author Tony Martins Ajaero

Home » Business Plans » Beauty Care Sector » Beauty & Hair Salon

Are you about starting a booth rental salon? If YES, here is a complete sample booth rental salon business plan template & feasibility report you can use for FREE .

Okay, so we have considered all the requirements for starting a booth rental salon. We also took it further by analyzing and drafting a sample booth rental salon marketing plan template backed up by actionable guerrilla marketing ideas for booth rental salons. So let’s proceed to the business planning section .

If you are interested in the salon business and looking towards launching a business as an aspiring entrepreneur, one of your best bet is to launch a booth rental salon business. The right time to start such business is now because this business concept is presently at its growing stage.

Booth rental salon is operated or owned by a person known as booth renter. Their responsibility is to lease space from a large salon or a suite of small salons to hairstylists, barbers and similar businesses who may not want to shoulder the responsibilities of owning a standard salon facility.

The booth rental method simplifies the financial aspect of owning a salon. All you need to do to run this business is to provide the space and charge each stylist a set amount for rent.

A booth rental salon business could be a fun, profitable and interesting for someone who is a contractor and has business perseverance and smartness. With the right location, top-notch facility and good marketing skills, you can accommodate top profile hairstylists and barbers et al who would want to run their business from a booth rental salon facility.

Starting up a booth rental salon business may not require huge startup capital, but it needs a significant investment capital, solid planning, and attention to detail in order to keep your business profitable. The bottom line is that if you are determined to explore the entrepreneurial world by starting a standard booth rental salon business, then you should consider going through the business plan below.

A Sample Booth Rental Salon Business Plan Template

1. industry overview.

Booth rental salon business is part of the hair salon industry and the industry includes salons that primarily offer hair care services such as haircutting, hair coloring and hairstyling services. In addition, these companies may also provide facials and makeup applications (except permanent makeup) and retail beauty products.

The Hair Salon industry has managed to untangle its early post – recessionary bumps. Rising consumer sentiment and per capita disposable income have boosted industry growth over the five years to 2017. This has also led to increased demand for ancillary services relating to haircuts such as hair modification treatments (e.g. straightening procedures and perms), skin-care services and massages.

In the coming years, the industry is forecast to exhibit continued growth. Per capita disposable income and consumer confidence will keep rising as the unemployment rate continues to decline, providing consumers with more discretionary income for luxury services at hair salons.

The Hair Salon industry is indeed a growing sector of the economy of the united states of America and it generates over billion annually from more than 1 million hair salons (booth rental salons inclusive) scattered all around the United States of America.

The industry is responsible for the employment of over 1.4 million people. Experts project that the industry will grow at a 1.8 percent annual rate between 2012 and 2017. No player can boast of having a lion share of the available market in this industry.

Research conducted by IBISWORLD reveals that the Hair Salons industry is in the mature phase of its life cycle. Industry value added, which measures the industry’s contribution to the overall economy, is projected to grow at an annualized rate of 1.9 percent in the 10 years to 2022. Over the same period, GDP is forecast to increase at an average annual rate of 2.1 percent.

Therefore, the industry is growing only marginally slower than the economy as a whole, which suggests that the industry is mature. Additionally, the industry exhibits characteristics of mature industries such as stable long-term demand and minimum product innovation. Product innovation has grown at a relatively steady rate over the five years to 2017.

The booth rental salon line of business is very open to any aspiring entrepreneur who has the capacity to open and run his or her booth rental salon. Just ensure that your booth rental salon is located in an environment with the right demography and you will be fine.

2. Executive Summary

Estee Jones® Booth Rental Salon®, Inc. is a licensed booth rental salon business. We have been able to secure a standard facility in a central and busy district in Colorado Boulevard, Pasadena – California.

We are a booth rental salon company that is set to compete in the highly competitive and fragmented hair salons industry not only in Pasadena – California, but also throughout the United States market because we intend opening our booth rental salons in key cities across the United States.

Estee Jones® Booth Rental Salon®, Inc. will run a world – class booth rental salon. We intend to lease space to hairstylists, barbers and similar businesses who may not want to shoulder the responsibilities of owning a standard salon facility.

Our business goal is to become one of the leading booth rental salons in the United States and we will make sure that we do all we can to compete favorably with leaders in the industry. Our workers are going to be selected from a pool of certified, creative and highly experienced workers in and around Pasadena – California and also from any part of the United States of America as the business grows.

We will make sure that we take all the members of our workforce through the required training that will position them to meet the expectation of the company and to compete with leading booth rental salons in the United States and throughout the globe.

At Estee Jones® Booth Rental Salon®, Inc., our client’s best interest will always come first, and everything we do will be guided by our values and professional ethics. We will ensure that we hold ourselves accountable to the highest standards by meeting our client’s needs precisely and completely.

Estee Jones® Booth Rental Salon®, Inc. is owned by Estee Jones. A core professional with hands-on experience to run booth rental salon business.

3. Our Products and Services

Estee Jones® Booth Rental Salon®, Inc. was established with the aim of maximizing profits in the hair salon industry as a booth salon renter.

We want to compete favorably with the leading booth rental salons in the United States which is why we have but in place a competent team that will ensure that our booth rental salon facility meets and even surpass our customers’ expectations.

We will work hard to ensure that Estee Jones® Booth Rental Salon®, Inc. is not just accepted in Colorado Boulevard, Pasadena – California, but also in other cities in the United States of America where we intend opening our chains of booth rental salons.

Our products and services are listed below;

• Providing booth salon spaces for rentals
• Merchandise sales of hair salon related products

4. Our Mission and Vision Statement

• Our vision is to establish a standard and world class booth rental salon facility whose facility and brand will not only be accepted in Colorado Boulevard, Pasadena – California, but also in other cities in the United States of America where we intend opening our chains of booth rental salons.
• Our mission is to provide a standard booth rental salon that can attract some of the leading hairstylists, barbers and similar businesses who may not want to shoulder the responsibilities of owning a standard salon facility. We want to build a booth rental salon brand that can favorably compete with other leading brands in the hair salon industry cum booth rental line of business.

Our Business Structure

Estee Jones® Booth Rental Salon®, Inc. is a booth rental salon company that intends starting small in Colorado Boulevard, Pasadena – California, but hope to grow big in order to compete favorably with leading booth rental salons in the industry both in the United States and on a global stage.

We are aware of the importance of building a solid business structure that can support the picture of the kind of world class business cum brand we want to own. This is why we are committed to only hire the best hands within our area of operation.

We will ensure that we hire people that are qualified, hardworking, creative, customer centric and are ready to work to help us build a prosperous business that will benefit all the stakeholders.

As a matter of fact, profit-sharing arrangement will be made available to all our senior management staff and it will be based on their performance for a period of five years or more as agreed by the board of trustees of the company. In view of the above, we have decided to hire qualified and competent hands to occupy the following positions;

• Chief Executive Officer
• Booth Rental Salon Manager

Human Resources and Admin Manager

• Sales and Marketing Executive

Facility Manager

Client Service Executive

5. Job Roles and Responsibilities

Chief Executive Officer – CEO:

• Increases management’s effectiveness by recruiting, selecting, orienting, training, coaching, counseling, and disciplining managers; communicating values, strategies, and objectives; assigning accountabilities; planning, monitoring, and appraising job results; developing incentives; developing a climate for offering information and opinions; providing educational opportunities.
• Responsible for fixing prices and signing business deals
• Responsible for providing direction for the business
• Creates, communicates, and implements the organization’s vision, mission, and overall direction – i.e. leading the development and implementation of the overall organization’s strategy.
• Responsible for signing checks and documents on behalf of the company
• Evaluates the success of the organization

Booth Rental Salon Manager:

• Serves as project manager of the organization; works directly with employees
• Builds company image by collaborating with customers, government, community organizations, and employees; enforcing ethical business practices
• Maintains quality service by establishing and enforcing organization standards
• Ensures that the organization works in line with international best practices
• Responsible for overseeing the smooth running of HR and administrative tasks for the organization
• Designs job descriptions with KPI to drive performance management for clients
• Regularly hold meetings with key stakeholders to review the effectiveness of HR Policies, Procedures and Processes
• Maintains office supplies by checking stocks; placing and expediting orders; evaluating new products
• Ensures operation of equipment by completing preventive maintenance requirements; calling for repairs
• Defines job positions for recruitment and managing interviewing process
• Carries out induction for new team members
• Responsible for training, evaluation and assessment of employees
• Responsible for arranging travel, meetings and appointments
• Oversee the smooth running of the daily office activities

Sales and Marketing Manager

• Manages external research and coordinate all the internal sources of information to retain the organizations’ best customers and attract new ones
• Models demographic information and analyze the volumes of transactional data generated by customer
• Identifies development opportunities; follows up on development leads and contacts; participates in the structuring and financing of projects
• Writes winning proposal documents, negotiate fees and rates in line with organizations’ policy
• Responsible for handling business research, market surveys and feasibility studies for clients
• Responsible for supervising implementation, advocate for the customer’s needs, and communicate with clients
• Develops, executes and evaluates new plans for expanding increase sales and ensuring that all our salon booth spaces are rented out
• Creates new markets cum businesses for the organization
• Empowers and motivates the sales team to meet and surpass agreed targets

Accountant/Cashier:

• Responsible for preparing financial reports, budgets, and financial statements for the organization
• Provides managements with financial analyses, development budgets, and accounting reports; analyzes financial feasibility for the most complex proposed projects; conducts market research to forecast trends and business conditions.
• Responsible for financial forecasting and risks analysis.
• Performs cash management, general ledger accounting, and financial reporting for one or more properties.
• Responsible for developing and managing financial systems and policies
• Responsible for administering payrolls
• Ensures compliance with taxation legislation
• Handles all financial transactions for the organization
• Serves as internal auditor for the organization
• Responsible for making sure that buildings (salon booths) and our services meet the needs of the people that work in them
• Supervising multi-disciplinary teams of staff including cleaning, maintenance, grounds and security
• Ensures that basic facilities such as water and heating, are well-maintained
• Allocating and managing space between buildings
• Ensures that facility meets government regulations and environmental, health and security standards
• Advises businesses on increasing energy efficiency and cost-effectiveness
• Overseeing building projects, renovations or refurbishments
• In charge of services such as cleaning, security and parking, to make sure the surrounding environment is in a suitable condition to work
• Welcomes clients and potential clients by greeting them in person or on the telephone; answering or directing inquiries.
• Ensures that all contacts with clients (e-mail, walk-In center, SMS or phone) provides the client with a personalized customer service experience of the highest level
• Through interaction with clients on the phone, uses every opportunity to build client’s interest in the company’s products and services
• Manages administrative duties assigned by the Human Resource and Admin Manager in an effective and timely manner

6. SWOT Analysis

Estee Jones® Booth Rental Salon®, Inc. engaged the services of a core professional in the area of business consulting and structuring to assist our organization in building a well – structured booth rental salon business that can favorably compete in the highly competitive hair salons industry in the United States and the world at large.

Part of what the consultant did was to work with the management of our organization in conducting a comprehensive SWOT analysis for Estee Jones® Booth Rental Salon®, Inc. Here is a summary from the result of the SWOT analysis that was conducted on behalf of Estee Jones® Booth Rental Salon®, Inc.;

Our core strength lies in the power of our team. We have a team of certified, creative and highly trained and experience workers, a team with excellent qualifications and experience in the booth rental salon line of business.

Aside from the synergy that exists in our carefully selected workforce, our services will be guided by best practices in the industry. Another strength that counts for us in the location of our booth rental salon; it is located in one of the most ideal locations for such business in Colorado Boulevard, Pasadena – California.

As a new booth rental salon in Colorado Boulevard, Pasadena – California, it might take some time for our booth rental salon to break into the market and gain acceptance especially from top profile clients in the already saturated and highly competitive hair salons industry; that is perhaps our major weakness.

Another weakness is that we may not have the required cash to pump into promoting our business the way we would want to.

• Opportunities:

No doubt, the opportunities in the booth rental salon line of business are massive considering the number of hairstylists and barbers in the United States who are embracing the option of cutting cost. As a booth rental salon company, we are ready to take advantage of any opportunity that is available in the industry.

Just like any other business, one of the major threats that we are likely going to face is economic downturn. Another threat that may likely confront us is the arrival of a new booth rental salon in same location where our target market exists and who may want to adopt same Business model like us.

7. MARKET ANALYSIS

• Market Trends

The fact that renting a booth in a salon can be a cost-effective for both the salon owner and workers makes it an ideal business model for hairstylists and barbers who just want to start small and grow big. This business model gives room for aspiring hairstylists and barbers to pitch their business in highbrow areas without necessarily breaking the bank.

All they need to do is to ensure that their services are top – notch and they won’t have to spend loads of cash maintaining the facility or marketing their services. It is the responsibility of the salon booth rental company to promote and maintain their salon booths.

Lastly, booth rental salon operators, in a bid to generate more revenue for their business engage in retailing hair products. They are also involved in rental of salon tools and equipment.

8. Our Target Market

Before starting our booth rental salon in Colorado Boulevard, Pasadena – California, we conducted a thorough market survey and feasibility studies and we are certain that there are loads of hairstylists, barbers, tanning and nail specialists et al who need small spaces in our booths to run their business.

Estee Jones® Booth Rental Salon®, Inc. will work towards providing services, facilities and environment that will help us reach out to our target market. In view of that, we have created strategies that will enable us reach out to various groups of people who we know will need our services. Below is a list of the people that we will specifically market our facility to;

• Hairstylists
• Manicure and pedicure specialists
• Tanning specialists

Our Competitive Advantage

Surviving in the business world as a booth rental salon company operator requires more than your expertise and creativity but also how to network with key people that matters; entrepreneurs that can rent your salon booths.

Because of the competitive nature of the booth rental salon line of business, there is an increasing degree of related business activities, with big players dominating the market. We are quite aware that to be highly competitive in the booth rental salon line of business means that you are not only expected to be able to make available top – notch and safe salon booths, but you must be able to meet set targets.

Our competitive advantage is anchored on the state of the art booth salon facility that we have. So also, we have a team of certified, creative and highly trained and experience workers. Aside from the synergy that exists in our carefully selected workforce, our services will be guided by best practices in the industry.

Another strength that counts for us is the location of our booth rental salon; it is located in a very busy area that is highly suitable for such business in Colorado Boulevard, Pasadena – California.

Lastly, all our employees will be well taken care of, and their welfare package will be among the best within our category in the industry. It will enable them to be more than willing to build the business with us and help deliver our set goals and achieve all our business aims and objectives.

9. SALES AND MARKETING STRATEGY

• Sources of Income

Estee Jones® Booth Rental Salon®, Inc. is established with the aim of maximizing profits in the booth rental salon line of business and we are going to go all the way to ensure that we do all it takes to meet and surpass the expectations of all our clients. Estee Jones® Booth Rental Salon®, Inc. will generate income by offering the following services;

• Providing booth salon space for rentals

10. Sales Forecast

One thing is certain, there would always be aspiring entrepreneurs /hairstylists, barbers and related business owners who would need to cut cost of starting the business hence the need to rent a small salon space in a booth rental salon facility.

We are well positioned to take on the available market in Pasadena – California and we are quite optimistic that we will meet our set target of generating enough income from the first six months of operation and grow our booth rental salon business to enviable heights.

We have been able to critically examine the booth rental salon market, we have analyzed our chances in the industry and we have been able to come up with the following sales forecast. The sales projections are based on information gathered on the field and some assumptions that are peculiar to similar startups in Pasadena – California.

Below are the sales projections for Estee Jones® Booth Rental Salon®, Inc. It is based on the location of our booth rental salon facility and of course our target market;

• First Fiscal Year: $120,000
• Second Fiscal Year : $350,000
• Third Fiscal Year : $750,000

N.B : This projection was done based on what is obtainable in the industry and with the assumption that there won’t be any major economic meltdown and there won’t be any major competitor offering same facility as we do within same location. Please note that the above projection might be lower and at the same time it might be higher.

• Marketing Strategy and Sales Strategy

Our marketing strategies will be directed towards achieving specific objectives that support the strategic goals of the organization. The truth is that all that we do will be geared towards creating new market channels, increasing sales and our market share.

Our unique selling proposition is that we are well positioned, we offer state-of-the-art facility, people can easily access our facility, and our various payment platforms are highly reliable.

Our sales and marketing team will be recruited based on their vast experience and they will be trained on a regular basis so as to be well equipped to meet their targets and the overall business goal of Estee Jones® Booth Rental Salon®, Inc.

Our corporate goal is to grow Estee Jones® Booth Rental Salon®, Inc. to become one of the top 10 booth rental salon brands in the United States of America which is why we have mapped out strategies that will help us take advantage of the available market and grow to become a major force to reckon with not only in Pasadena – California but also in other cities in the United States of America where we intend opening our chains of booth rental salon facilities.

Estee Jones® Booth Rental Salon®, Inc. is set to make use of the following marketing and sales strategies to attract clients;

• Open our booth rental salon business with a big party
• Advertise our booth rental salon business on national dailies, local TV and radio stations
• Promote our booth rental salon business online via our official website and all available social media platforms
• Introduce our business by sending introductory letters alongside our brochure to hair stylists, barbers, tanning specialists and manicure and pedicure specialists and key stake holders in Pasadena – California
• Print out fliers and business cards and strategically drop them in offices, sport facilities, libraries, public facilities and train stations et al.
• Make use of attractive hand bills to create awareness and also to give direction to our booth rental salon facility
• Adopt direct mailing coupon marketing approach
• Position our signage/flexi banners at strategic places in and around Pasadena – California

11. Publicity and Advertising Strategy

We have been able to work with our brand and publicity consultants to help us map out publicity and advertising strategies that will help us walk our way into the heart of our target market.

We are set to become the number one choice for hairstylists, barbers, tanning, manicure and pedicure specialists in the whole of Pasadena – California and other cities in the United States of America where we intend opening our chains of booth rental salons which is why we have made provisions for effective publicity and advertisement of our business.

Below are the platforms we intend to leverage on to promote and advertise Estee Jones® Booth Rental Salon®, Inc.;

• Place adverts on both print (newspapers and magazines) and electronic media platforms
• Leverage on the internet and social media platforms like Instagram, Facebook, twitter, YouTube, Google + et al
• Install our billboards in strategic locations all around Pasadena – California
• Distribute our fliers and handbills in target areas
• List our booth rental salon business in local directories/yellow pages
• Advertise our booth rental salon in our official website and employ strategies that will help us pull traffic to the site.
• Ensure that all our staff  wear our branded shirts and all our vehicles are well branded with our company logo et al.

12. Our Pricing Strategy

Our pricing system is going to be based on what is obtainable in the industry, we don’t intend to charge more (except for premium and customized facility and services) and we don’t intend to charge less than what our competitors are charging their clients in Pasadena – California and throughout the United States.

Be that as it may, we have put plans in place to offer discount services once in a while. The prices of our services will be same as what is obtainable in the United States’ booth rental salon facility open market.

• Payment Options

The payment policy adopted by Estee Jones® Booth Rental Salon®, Inc. is all inclusive because we are quite aware that different customers prefer different payment options but at the same time, we will ensure that we abide by the financial rules and regulation of the United States of America.

Here are the payment options that Estee Jones® Booth Rental Salon®, Inc. will make available to her clients;

• Payment via bank transfer
• Payment with cash
• Payment via Point of Sale Machine (POS)
• Payment via online bank transfer
• Payment via check
• Payment via bank draft

In view of the above, we have chosen banking platforms that will enable our client make payment for renting our salon booth facility without any stress on their part. Our bank account numbers will be made available on our website and promotional materials.

13. Startup Expenditure (Budget)

In setting up any business, the amount or cost will depend on the approach and scale you want to undertake. If you intend to go big by renting a place, then you would need a good amount of capital as you would need to ensure that your facility is conducive enough for workers to be creative and productive. This is what it would cost us to set up Estee Jones® Booth Rental Salon®, Inc. in the United of America;

• The total fee for registering the business in the United States of America – $750
• Legal expenses for obtaining licenses and permits – $1,500
• Marketing promotion expenses (8,000 flyers at $0.04 per copy) for the total amount of – $10,000
• The total cost for hiring Business Consultant – $5,000
• The amount needed for the purchase of insurance policy covers (general liability, workers’ compensation and property casualty) coverage at a total premium – $30,800
• The total cost for the purchase of accounting software, CRM software and Payroll Software – $3,000
• The total cost for leasing facility for the business – $150,000
• The total cost for facility remodeling to fit into the type of booth rental salon facility – $80,000
• Other start-up expenses including stationery – $1000
• Phone and utility deposits – $3,500
• Operational cost for the first 3 months (salaries of employees, payments of bills et al) – $40,000
• The cost for the purchase of furniture and gadgets (Computers, Printers, Telephone, TVs, Sound System, snooker board, tables and chairs et al) – $4,000.
• The cost of launching a Website – $600
• The cost for our grand opening party – $15,000
• Miscellaneous – $5,000

Going by the report from the market research and feasibility studies conducted, we will need about three hundred and fifty thousand ( 350,000 ) U.S. dollars to successfully set up a medium scale but standard booth rental salon business in the United States of America.

Generating Startup Capital for Estee Jones® Booth Rental Salon®, Inc.

No matter how fantastic your business idea might be, if you don’t have the required money to finance the business, the business might not become a reality. Finance is a very important factor when it comes to starting a booth rental salon.

Estee Jones® Booth Rental Salon®, Inc. is a private business that is solely owned and financed by Ms. Estee Jones and her partner. They do not intend to welcome any external business partner which is why he has decided to restrict the sourcing of the startup capital to 3 major sources.

Since they are the sole financier of the business, they have decided to adopt the following means to generate startup capital for the business;

• Generate part of the startup capital from personal savings
• Source for soft loans from family members and friends
• Apply for loan from the Bank

N.B: We have been able to generate about $150,000 ( Personal savings $100,000 and soft loan from family members $50,000 ) and we are at the final stages of obtaining a loan facility of $200,000 from our bank. All the papers and documents have been signed and submitted, the loan has been approved and any moment from now our account will be credited with the amount.

14. Sustainability and Expansion Strategy

One of our major goals of starting Estee Jones® Booth Rental Salon®, Inc. is to build a business that will survive off its own cash flow without the need for injecting finance from external sources once the business is officially running.

We know that one of the ways of gaining approval and winning customers over is to lease our state of the art salon booths a little bit cheaper than what is obtainable in the market and we are well prepared to survive on lower profit margin for a while.

Estee Jones® Booth Rental Salon®, Inc. will make sure that the right foundation, structures and processes are put in place to ensure that our staff welfare are well taken of. Our company’s corporate culture is designed to drive our business to greater heights and training and retraining of our workforce is at the top burner.

We know that if that is put in place, we will be able to successfully hire and retain the best hands we can get in the industry; they will be more committed to help us build the business of our dreams.

Check List/Milestone

• Business Name Availability Check: Completed
• Business Incorporation: Completed
• Opening of Corporate Bank Accounts various banks in the United States: Completed
• Opening Online Payment Platforms: Completed
• Application and Obtaining Tax Payer’s ID: In Progress
• Securing a standard facility and reconstructing the facility to fit into the kind of booth rental salon facility we want to manage: Completed
• Application for business license and permit: Completed
• Purchase of Insurance for the Business: Completed
• Conducting Feasibility Studies: Completed
• Generating part of the startup capital from the founders: Completed
• Writing of Business Plan: Completed
• Drafting of Employee’s Handbook: Completed
• Drafting of Contract Documents: In Progress
• Design of Logo for the business: Completed
• Graphic Designs and Printing of Promotional Materials: Completed
• Recruitment of employees: In Progress
• Purchase of the needed furniture, office equipment, software applications, electronic appliances and facility facelift: In progress
• Creating official website for the business: In Progress
• Creating Awareness for the business: In Progress
• Health and Safety and Fire Safety Arrangement: In Progress

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Salon Business Plan Ultimate Guide + Free Example

July 6, 2023

Adam Hoeksema

When it comes to starting a salon, you may be eager to dive into the world of beauty and make your clients look and feel their best. However, it's important to recognize that writing a business plan is a crucial step, especially when seeking support from potential lenders and investors.

While it may not be the most exciting task, a well-prepared business plan demonstrates your commitment and professionalism, making it an essential tool to secure the necessary funding and outline your salon's path to success. It's also important to make sure your business plan and financial projections are realistic and inline with some industry averages for salons .

This guide is going to help you walk through the following:

• Salon Business Plan Outline
• Conducting Market Research for Your Salon Business Plan
• Creating Financial Projections for Your Salon Business Plan

Example Salon Business Plan

Salon business plan faqs.

With that in mind as the path forward, let’s dive in. 

What Should be Included in a Salon Business Plan?

A salon business plan must convincingly show to prospective financiers and loan providers why clients would opt for your salon, why you or your crew are best suited to oversee the salon operations, and how the financial projection to ensure a favorable financial return on their investment. Here is a thorough breakdown of our complimentary salon business plan template .

‍ Salon Business Plan Outline ‍

I Executive Summary

II Market Analysis

III Business Description

IV Marketing and Sales Strategies

V Menu of Services and Pricing

VI Operational Plan

VII Financial Plan

• Startup Costs
• Projected Financial Summary
• Annual Sales, Gross Profit and Net Profit
• Key Financial Ratios
• Watch how to create financial projections for your very own salon
• Income Statement
• Balance Sheet
• Cash Flow Statement

VIII Conclusion

How to Conduct Market Research for a Salon Business Plan

At the core of any salon business plan is market research. It's necessary to understand your position within the market and establish that there is a substantial demand for your unique salon concept, location, and pricing tiers. You can delve more into our salon market research approach here, but essentially, you're seeking to understand your competitors, obtain insights on potential customer traffic, select an ideal location, and foresee any seasonal trends that may affect your business. Below are some tools and tactics for executing market research for your planned salon.

What Will be the Cost to Advertise my Salon?

We suggest using Google Keyword Planner to help you identify which keywords to promote to attract customers to your salon's website. The tool also offers an estimate of the cost per click for advertising using various keywords, as demonstrated below:

What Keywords are Customers Searching for?

We use both Google Keyword Planner and Ahrefs to identify which keywords are driving traffic to your competitors' websites. For example, you can run a report on a competitor's site to identify the keywords they rank for and the amount of organic traffic each keyword garners. This data can guide your SEO initiatives.

How Seasonal are Salons?

We like to utilize Google Trends to determine how seasonal your salon concept might be. For instance, you can observe below that the search volume for “salons near me” in the United States is somewhat seasonal in nature.  June is consistently the peak, with the late fall tending to be the low point of the season

How Many Customers Visit my Competitors Each Month?

Finally, we recommend pulling foot traffic reports on your competitors to understand the average number of customers they typically serve in their salons. You can see an example below showing the number of visits per month for a specific location:

Ultimately, your potential customer base's size for your salon will be a crucial assumption underpinning your financial projections. Thus, grasping how many customers frequent your competitors can help you predict potential traffic to your salon.

How to Create Financial Projections for a Restaurant Business Plan

With comprehensive market research completed, it's time to develop financial projections for your salon. Our salon financial projection templates rely on various factors, such as client traffic and service capacity, to form the basis of your revenue projections. While some salons may have limitations on the number of available appointments, others may be constrained by the time it takes to deliver services effectively. Creating accurate financial projections is crucial to showcase your salon's potential to repay loans and provide a return on investment to potential stakeholders. To achieve this, consider the following steps:

• Estimate startup costs for your salon
• Forecast revenue (employee based, booth rent, salon suite, hybrid)
• Project supplies and labor cost
• Estimate your operating expenses like rent and utilities
• Calculate how much investor or loan capital you will need to open

Our salon projection template will guide you through this process and help format your projections in a standard format that meets the requirements of potential investors or lenders. Typically, startup salon projections should include an integrated income statement, balance sheet, and cash flow forecast.

By following these steps and utilizing our salon projection templates, you'll have a solid foundation for presenting your salon's financial outlook and demonstrating its potential profitability.

Below you will find the text of our salon business plan. You can also access a downloadable Google Doc version of this salon business plan template here , enabling you to make personalized edits. Additionally, we have created a helpful video walkthrough that guides you through the process of tailoring the business plan to suit your salon concept.

Table of Contents

Executive Summary

Our salon, called "Lux Beauty Spa," is a full-service beauty and wellness center that aims to provide a luxurious and rejuvenating experience for all of our clients. Our mission is to enhance the beauty and well-being of each individual that walks through our doors, through personalized and expert services. 

We will offer a wide range of services including hair styling, nail care, skin treatments, massage therapy, and more.

Our target market is women and men of all ages who are looking for a high-quality beauty and wellness experience. We will be located in a high-end shopping center in downtown to attract our affluent target market. Our projected start-up costs are $200,000, and we anticipate reaching profitability within two years.

Market Analysis

The beauty and wellness industry is growing, with a projected global market size of $716.3 billion by 2027. In our target market, there is a growing demand for high-end beauty and wellness experiences, and a trend towards holistic and natural approaches to self-care.

Our main competitors include established high-end salons and spa centers in the area, but we differentiate ourselves through our focus on personalization and luxury. We will also offer services and products not commonly found in traditional salons, such as custom skincare treatments and exclusive hair care lines.

Business Description

Lux Beauty Spa will be a limited liability company (LLC), owned and operated by two experienced beauty professionals. We will be fully licensed and insured, and comply with all state and local regulations.

Services Offered:

Lux Beauty Spa will offer a comprehensive range of beauty and wellness services, including:

• Hair styling: We will have a team of skilled hair stylists offering cuts, coloring, and styling services for all hair types. We will use high-quality hair care products and tools, including well-known and exclusive brands.
• Nail care: Our nail technicians will offer a variety of nail services including manicures, pedicures, and gel polishes.
• Skin treatments: Our licensed estheticians will offer custom skincare treatments, including facials, peels, and microdermabrasion. We will use only the finest and natural skincare products.
• Massage therapy: Our licensed massage therapists will offer a range of massage services, including Swedish, deep tissue, and hot stone.

Marketing and Sales Strategies

To attract and retain clients, we will employ several marketing and sales strategies, including:

• Online advertising: We will create a professional and attractive website, and use targeted online advertising to reach our target market.
• Promotions and discounts: We will offer promotions and discounts to new clients and for special occasions, such as birthdays and holidays.
• Loyalty program: We will reward our regular clients with exclusive discounts and special offers.
• Referral program: We will incentivize our clients to refer their friends and family to Lux Beauty Spa with discounts and bonuses.

Menu of Services and Pricing

Our menu of services and pricing will be competitive with other high-end salons in the area. We will offer packages and memberships for regular clients, as well as a la carte services for those who prefer one-time treatments. Our prices will reflect the luxury and quality of our services and products.

Operational Plan

Lux Beauty Spa will operate 7 days a week, from 9 AM to 9 PM. Our staffing will include a manager, hair stylists, nail technicians, estheticians, massage therapists, and a receptionist. We will use scheduling software to manage appointments and ensure efficient use of our resources. Our inventory management will include regular monitoring of product levels and restocking as needed. We will also keep detailed financial records and regularly review our performance to make necessary adjustments to our operations.

Financial Plan

Our projected start-up costs are $200,000, which will cover rent, equipment and supplies, marketing, and salaries. Our operating expenses will include rent, utilities, supplies, salaries, and marketing. Our sales revenue will come from services and product sales, and we anticipate a steady growth in revenue over the next two years.

Our financial projections show we’ll break even in year 3 and grow profit considerably after that.

All of the unique financial projections you see below were generated using ProjectionHub’s Salon  financial projection template s. Use PH20BP to enjoy a 20% discount on the template. 

Startup Costs:

Projected Financial Summary:

Annual Sales, Gross Profit and Net Profit:

Key Financial Ratios:

Watch how to create financial projections for your very own salon:

Income Statement:

Balance Sheet:

Cash Flow Statement:

Lux Beauty Spa is poised to become a leading luxury beauty and wellness center, offering personalized and expert services to our affluent target market. With a strong focus on quality and luxury, we are confident in our ability to achieve profitability and success in the beauty and wellness industry.

What should I include in a salon business plan?

A salon business plan should include sections on executive summary, company description, market analysis, target market and services, pricing and packages, marketing and promotion strategies, location and facilities, staffing and management, and financial projections.

How can I determine the ideal location for my salon?

When selecting a location for your salon, consider factors such as foot traffic, visibility, accessibility, competition in the area, parking availability, and proximity to your target market. A location near residential areas or commercial districts with a high demand for salon services can be ideal.

How can I estimate financial projections for my salon?

Financial projections for a salon should include estimates for start-up costs, monthly expenses (such as rent, utilities, products, and employee salaries), projected revenue based on service pricing and expected clientele, and a break-even analysis to determine when your salon will become profitable.

About the Author

Adam is the Co-founder of ProjectionHub which helps entrepreneurs create financial projections for potential investors, lenders and internal business planning. Since 2012, over 50,000 entrepreneurs from around the world have used ProjectionHub to help create financial projections.

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How to Know if Your Financial Projections are Realistic

It is important for financial projections for a small business or startup to be realistic or else an investor or lender may not take them seriously. More importantly, the founder may make a financial mistake without a reliable plan.

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How to Run a Successful Booth Rental Salon

Mar 17, 2022 By SALONORY

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Are you opening a salon and wondering how you will secure talent? Or are you looking to change your business model around and entertaining the idea of turning your available chairs into booth rentals? Either way, you have come to the right place for salon business advice.

At SALONORY, we have our finger on the pulse of all things salon. Salons are lucky to have a variety of ways to staff their salons, and being able to offer booth rentals is just one way.

While offering booth rentals is a popular business method, they have their pros and cons just like any other model. In this article, we will help you determine whether or not offering booth rentals is right for your salon and business.

What Are Booth Rentals, and Why Are They Popular?

Let’s first look into just what booth rentals are exactly. Instead of hiring stylists to work at your salon full-time, you can offer a booth rental model if you have open chairs. This allows stylists and barbers to rent their chairs and salon stations from you. Instead of having to pay full-time stylists, you will have talent paying you to rent your stations. This model also provides flexibility for stylists and makes it easier to attract talent as many salons are currently facing a labor shortage . Booth rentals could also create an entirely new stream of revenue for you — depending on what your existing business model looks like.

The Drawbacks of Salon Booth Rentals

While there are many upsides to offering booth rentals, there are some drawbacks that salon owners should be aware of. Here are some of the most important factors to consider:

• Salon owners may not be able to make as much money from the services being offered since stylists are paying to rent the booth.
• Booth rentals may come and go, providing a lack of stability during slower periods of time.
• Salon owners may not be able to bond with, build relationships and get to know stylists since their position is most likely temporary.
• It can be hard to build and establish a culture with a revolving door of talent.
• The lines can get blurry when it comes to branding and using hair styling products that your salon stands behind. Contract stylists may have their own products they like to use.
• Salon owners miss out on the opportunity to build a loyal and consistent clientele base since clients usually come and go with stylists.

Running a booth rental salon may not be for everyone, but if you’ve decided to pursue this type of revenue stream, here are some tips for success that can lead you to run a successful program.

 1. Set Boundaries and Rules

Since stylists will be coming and going, there can be issues with consistency or stylists following ground rules and participating in your salon’s unique culture. To help mitigate this, offer a set of boundaries and rules that you have stylists agree to. Here are some areas we find to be helpful to focus on creating rules around.

• Salon Cancellation Policy
• Rent payments
• Service profit share
• Lease terms
• Salon responsibilities (cleaning, organizing, etc.)
• Product usage
• Scheduling transparency

2. Create Lease Terms that Work for Your Salon

If you would like to make your booth rental salon more stable, you can create lease terms for stylists that are more long-term. For example, instead of having stylists sign month-to-month leases, offer incentives for having them sign on for longer lease terms. These incentives could be discounts on rent or higher profit share.

3. Make Rent and Profit Sharing Feasible for You and Attractive to Stylists

Knowing what your salon can handle in terms of costs and income is important to finding the perfect balance in what you charge for rent and how much profit you share with your stylists. Take a look at your finances and keep close track of how the booth rental program is affecting your revenue and costs — negatively and positively.

4. Show Your Renters that You’re Invested

While these stylists may not be a part of your core staff, their success ultimately determines your success, too. You can let these stylists know you appreciate their time, business and presence by making them feel a part of the salon family.

5. Create Thorough Contracts

Lastly, you will want to create thorough contracts that help protect you and uphold your booth rental program rules. Your contracts should include information about your boundaries and rules, using all hair salon supplies , rent and lease terms, revenue opportunities and more information on dismissal and termination.

Every salon is different. To figure out if offering booth rentals is right for your business, try it out and measure your success throughout the first few months.

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Sample Booth Rental Salon Business Plan

• July 9, 2023

BOOTH RENTAL SALON BUSINESS PLAN SAMPLE

The success of a booth rental salon business largely depends on how detailed the planning phase is and how well such plans are implemented.

Not every entrepreneur knows how to write their nail or hair salon business plan. It’s unlikely for a poorly written plan to be of any meaningful use.

To help you avoid common mistakes made, we’ve provided a booth rental salon Business Plan to work with. This template highlights all the parts of a good plan and how to develop such.

With this guide, you should be able to avoid common mistakes by proper structuring of your plan.

Proper Structuring of your Plan

One of the primary things you’ll have to be concerned about is how your booth rental salon business plan is structured. We’re referring to the essential elements every good program should have.

These represent all the business’s vital aspects, which allow for a holistic outcome.

The critical elements to be added include the executive summary, company description, and the products & services sections.

Others include the market analysis section, strategy & implementation, organization & management team, and the financial plan & projection sections.

Knowing what needs to be included in each of these sections is vital. If you have no such idea, you need not worry as we’ve discussed each of them with details to be included.

With this said, let’s get into the specifics.

i. Executive Summary

The executive summary section gives a concise overview of the entire plan. It’s a condensed representation of the program that projects an optimistic view of the booth rental salon business idea.

Through this summary, a quick grasp of the plan’s contents is had. In other words, the basics are known within a short period.

Your executive summary should be around three pages long on average. While it appears before the other sections of the plan, it’s best written last to help summarize your thoughts more accurately and succinctly.

An investor is unlikely to have the time to go through the whole plan.

Through a well-written executive summary, investors are informed about the business concept and whether the idea is viable or not. There are reasons why your outline should be exciting and optimistic.

You want to generate the reader’s interest and make them want to learn more.

Some of the areas covered in the summary section include the business name & location, the products & services, mission & vision statements, and the specific purpose of the plan.

You should include a proper name for your booth rental salon. The name reveals its identity to your audience. Also important is the location of the business.

Your readers are likely to make mental judgments about how the location impacts sales or profitability.

What services and products will your booth rental salon business provide? Anyone reading through your plan gets an idea of what you do. However, don’t get carried away while trying to discuss your services.

Remember this is the executive summary and should only state the essentials.

Your mission statement should articulate your business’s purpose. It should point to a definite goal you intend to accomplish. Also, the mission statement tells why your booth rental salon business exists.

The vision statement should convey your dream for the company.

In other words, the vision statement should clearly inform your audience about where you envision your business to be at some definite point in the future.

It’s an internal communications tool that’s designed to inspire.

ii. Business Description

Through your business description section, your audience should be able to learn who you are, how you operate, and the goals you plan on achieving. Begin by providing the legal structure under which you’ll run.

Next, discuss how you plan on making a profit.

This should be followed by a brief history of the business, its nature, and the needs or demands you plan on filling. A summary of your short and long-term goals will be necessary.

Also, you should add a summary of business growth with financial or market highlights. Give an overview of your services and products with customers and suppliers.

iii. Products & Services

What products and services does your booth rental salon business provide?

Here, details on products and service costs, suppliers, and expected revenue from the sale of services and products are needed. To what benefit are your services and products to your customers?

Explain your services and products’ market role and include information on research and development activities leading to new products and services.

iv. Market Analysis

Through your market analysis, your audience should have a fair understanding of how prepared you are. Include a sketch of your targeted customer segments with size and demographics included.

Identify your competitors and assess their weaknesses and strengths.

An industry description with an outlook and statistics will be essential. Also, historical, current, and projected marketing data for services and products are essential.

v. Strategy & Implementation

How do you intend on implementing your sales and marketing strategies?

Here, you’ll need to explain your plan on promoting your booth rental salon business and how you’ll enter the market. Also, critical details on pricing, costs, and promotions will need to be added.

What are your labor sources, and how will you hire many employees? Your audience also needs to know how the business will function.

vi. Organization & Management Team

Your organizational structure impacts the overall success of your booth rental salon business.

To adequately cover this, you’ll need to focus on providing an organizational chart with descriptions of departments and key employees. Details about the owners will also need to be provided.

A profile of your management team consisting of their names, positions, primary responsibilities, and experience will be necessary.

vii. Financial Plan & Projections

Your financial plan and projections should be developed with the help of a professional accountant.

Critical aspects of the financial statements should include historical financial data, practical prospective financial information, and analysis of financial data.

When adequately discussed, all of these points should result in a comprehensive booth rental salon business plan.

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Salons For Sale

Beauty salon business plan template & guide [updated 2024], beauty salon business plan template & guide [updated 2023].

Thinking about opening a salon or expanding your brand? A salon business plan template is a great place to start!

Writing a business plan can be a time consuming and daunting task. Our company reviews business plans from across the US and Canada, so we have created this guide to help you streamline your business planning!

Stuck on what to name your salon? Check out the do’s and don’ts in choosing a salon name on this page.

What are the Main Types of Beauty Salons?

The main types of beauty salon businesses are: Employee based and non-employee based. Read our blog for a thorough explanation of how employee based salons differ from non-employee based salons.

Why do You Need a Business Plan Template?

A business plan template is needed to conduct market research, document your business plan and demonstrate your knowledge of salon business. This is the best pathway to raise funding. Even if you plan to just use your personal funds to open a salon, a successful salon business plan will help you get your head around what needs to happen to make your business successful.

Thinking through aspects of doing business such as marketing efforts, what a cash flow statement means, research on the local market and salon equipment costs provides an excellent salon business plan guide.

Templates for such a plan are found on the best business plan software, LivePlan. LivePlan is an easy to use template that walks your through EVERYTHING you need for a salon business plan.

Writing a hair salon business plan from scratch is very difficult and you may accidentally leave out important information. Included in the LivePlan salon business plan template are aspects you may not think are important but are needed to raise funding and open a new salon

What is included in a salon business plan outline?

A salon business plan outline iscreating a living document that includes things like: Business model, your definition of exceptional customer service, market research, financial projections, salon services menu, competitor salons, cash flow statement, executive summary, management team and day to day operations.

LivePlan is the most commonly used business plan template for salons, spas, barbershops and beauty industry businesses of any size. As your company grows, it’s not just about hair styling or nail art! A solid, mapped out beauty salon business plan yields amazing results throughout your business’s lifespan.

Download Your Free Salon Business Plan Template

There are many free salon business plan template examples out there. From our experience, none of them include real beauty industry success stories. Often, using another salon business plan for your own leaves out the most important factors in securing angel investors and getting a bank loan.

We used LivePlan for our own business- Salonspa Connection , so we have firsthand experience with this perfect business plan template!

Brainstorm your salon goals and vision

It starts with a dream… Did you fantasize about being a salon owner in beauty school or have you always wanted to be a business owner, regardless of the industry? The core of your “why” is one of the most important parts of a business plan.

Translating your “Why”

Why do you want to become a salon owner? Do you want to provide the type of environment you wish you had when searching for a salon job?

Is there a gap in your local community for more gender inclusive hair treatments? Maybe no one is offering spa services in your neighborhood and you have the best marketing strategy.

Understanding and documenting your motivation to own a beauty salon is the best place to start. Jot these nuggets down as it is the first step to writing a great salon business plan outline.

How profitable is owning a salon?

Owning a salon can be very profitable is you understand the type of business model, salon services you need to offer and how to pick the best salon location.

If you are considering buying an existing salon, read our blog on the best questions to ask the current owner, here.

Profitability is largely dependent on catering to existing clients, recruiting excellent hair stylists and hitting your target market with a great salon business. Fleshing through your ideas and beauty salon business strategies is best accomplished with a LivePlan business plan template.

Is owning a salon a good investment?

Owning a salon can be a great investment if you understand the dynamics of a hair salon business or nail salon. When you familiarize yourself with the industry, the likelihood of succeeding is much higher.

Both beauty salon professionals and non-salon industry pros buy and invest in salons.  Owning a beauty salon is a people management business. Providing beauty services, skin care services or nail services is just a small part of running a beauty salon business.

Hair salons can be cash cows when your balance sheet is positive and you successfully cultivate brand awareness. If you are considering investing in a hair salon, document your hair salon business plan with the best business planning software, LivePlan

Create an executive summary

An executive summary is an overview of your plan. This should be a detailed beauty salon business plan demonstrating your expertise in your industry as well as providing the roadmap to profitability.

How to write your salon’s executive summary: A simple template

An executive summary details the problem you are solving, your unique solution, identifying a target market, potential competition, financial forecast & projections and funding needed. Writing all of these details in an outline will provide an excellent guide for an executive summary.

If this sounds like a lot, it is! Planning out hair salons is much easier with a business plan template used in the LivePlan software.

What is a Good Mission Statement of a Salon?

A good mission statement is where you demonstrate your values and your “why” as to the “mission” of the salon. This is a fantastic space to create brand awareness.

You don’t need to go overboard here- a few sentences outlining your values and what your company provides existing and potential clients is ideal.

Remember your “why” we discussed earlier? Pull that info back out to create a great mission statement. This is not the space for a company description.

Salon Mission statement examples

We gathered several tips and samples of existing beauty salon mission statements, here . Use these examples to create a great hair salon mission of your own!

Write your salon’s business description

A hair salon is a dynamic business! It can be a struggle to harness all of the amazing things that makes you, YOU into a few paragraphs. We gathered up a few suggestions for a hair salon business description .

Beauty Services Management plan

If you plan on hiring beauty salon employees or opening a booth rental salon, you will need to think through management . Are you planning on being the sole management team or would you prefer to have some help?

Planning the service sales management aspect of business is a great thing to think through! Often, nail technicians or a hair stylist who achieve, and want to not be behind the chair full time are excellent candidates. Think through the strengths of your team with the ultimate business plan- LivePlan .

Management Team

Having a strong team who brings different skillsets to the table is an important part of a business plan. Evaluate where you are strong, and the gaps in your personal business skills can be picked up by either a manager or potentially an outside contractor.

Major Lengths Beauty Salon Products

Are you planning to sell white label beauty salon products? Including this in your business plan is key in understanding the cost vs. potential profitability. It doesn’t always pay off to have your own product lines- do your research before including this in your business plan.

Figure out your financial plan

How long will it take to become profitable? What needs to happen to become profitable? LivePlan walks you through services offered, pricing, costs and projections. This is the easiest software to use for those of us who struggle with the financial part of a beauty salon business.

Example of Problem a Salon Can Solve

The core of your beauty salon business plan template should be the problem, or problems you solve for your target clients. These are unmet needs or services that give you the competitive advantage over existing or competitor salons.

Keep the problem you are solving under 300 words and be concise!

An example would be: Southern Chicago is without a salon that welcomes the transgender and LGTBQ community, yet the population for this demographic grows by 15%, every year. Our experiences in living this lifestyle, and working with the gay and lesbian community, provides the safe salon space needed in the southern Chicago area.

The problem: no salons in your area to serve this population.

Your solution: providing a safe and quality space to serve the population in need of your services.

Get the best salon business plan template available, enjoy 40% off Liveplan today!

Solution the Salon Offers

Are you offering higher quality services at a lower price point? Or maybe you are the first salon to offer hair extensions in your neighborhood?

Offering specific solutions you provide for ideal customers is the key to obtaining financing!

Being Different through Customer Experience

The customer experience is what sets salons apart. Great hair can be achieved in a number of salons, how the customer feels in your salon is what needs to be captured in your beauty salon business plan.

Products and services

Think through how your products and services outshine competitors. Differentiating your salon is the path to creating a great business plan!

What can you do to create a solid financial plan for your salon?

A financial plan is one of the hardest parts of not only running a beauty salon business, but in predicting what this looks like in a business plan. LivePlan makes financial planning EASY, even for the most challenged money managers.

Example of Salon Expenses Description

Salon expense examples are: cost of products- both back bar and retail, rent or lease, taxes, payroll, marketing costs, insurance , salon software, accounting, equipment, laundry & cleaning expenses.

Monthly Salon Expenses List

Lining out monthly expenses vs annual expenses is a great way to predict income throughout the year. Holidays tend to have a higher outgo of expenditure, account for each month by thinking through what may be happening in specific months that would not happen in other months.

Make strategies for advertising and outreach marketing

Are you a people person or do you prefer to acquire clients from online resources? Assessing where salon owners’ strengths are will provide clearer strategies for future marketing efforts.

41 Most Effective Salon Marketing Ideas

Your marketing plan should include both initiatives to gain new clients and for recruiting, if you plan on hiring or renting out your spaces to salon professionals.

Your salon’s growth is dependent upon your ability to market your business to both potential clients and salon staff.

Here are 41 marketing touch points in a month, to include in your business plan:

Marketing for salon clients

8 social media posts per month on Instagram , Facebook Business Page and TikTok. The cadence for higher engagement and growth of social accounts should be to entertain, educate and promote.

2 in person events or visits to local businesses to create relationships. The right connections will pay off in spades!

18 referral cards or freebies given away, every month. Incentivizing current salon clients to send their friends is the best way to get new business ! Happy clients send more clients, it’s that simple.

1 in salon event per month. This can be botox parties, pop up boutique, an art show or whatever is most appropriate for your business model.

2 blog posts per month. Blogging for marketing is one of the most affordable and effective ways to increase visitors to your website. Turn visitors into paying customers with 2x monthly blogs!

4 current client incentives per month. This can mean a once a week discount on services or retail during slower times. For instance, a barber shop offers 50% off haircuts on Wednesdays from 9-11. This is their slowest time and is now full because of their marketing initiatives.

Salon Recruiting is marketing

4 social media posts per month demonstrating who you are and why your salon is the best place to work. These are not billboards for come work with us posts! Showing who you are and how amazing your salon is, with the invitation to come work with you is the goal.

1 visit to a cosmetology school or attendance in a salon industry event . Every month you, or someone from your team should be networking for recruiting.

Example of a Hair Salon Marketing Plan

When writing your new salon business plan, marketing ideas and a general plan for implementation are a must! Banks, investors or anyone you are seeking financing from are going to want to feel confident you can effectively market your new business.

Seeking small business loans or working with angel investors means you are looking to raise funding. Your marketing plan needs to have solid strategies and ideas that can be accomplished without draining your bank account.

My Most Essential Blog Posts when Growing a Salon or Spa Business

If you plan on blogging, this is the #1 way to get the highest visibility on search engines. It is time consuming and there is a lot to learn about how to structure blogs for search engines, but this is an excellent idea for evergreen marketing!

Blogs need specific information to produce results. Writing about subjects such as “most popular hairstyles in Miami” or “best curly hair products in Minneapolis” hit the target.

Every blog you write should highlight a specific service or product you sell, and include the city your salon is in. Writing for new client (or employee) discovery is the best way to gain business on search engines.

Target Market Analysis

This portion of your salon business plan outline identifies your ideal customer. Who will benefit the most from your salon services?

An easy-to-follow template to proceed with your target market analysis

Lining out customer demographics and the amount of potential customers you will have is the first step to an accurate financial projection. LivePlan walks you through this process, step by step with an easy to use business plan template.

Analyze and identify your target market

A great way to identify your ideal customers is to evaluate existing clients. What commonalities do these people have and how can you create a marketing strategy to similar people?

Example of Salon Competition Study in Your Plan

Knowing your competition is a big piece of a successful business plan- this is called market research. For example: If you want to open a salon that offers luxury services in a high end location, that’s great!

If the demand for these services are present, most likely there are competing salons in the area.

Understanding how your salon can differentiate from current, similar salons is the key. Business plans serve to allow you to demonstrate your value proposition in comparison to what already exists.

Improving upon what other salons are doing is the best way to raise funding. Take your top 3 competing salons and list out why your salon is above the rest.

For a complete guide to analyzing your competition, we suggest using LivePlan . LivePlan is the most comprehensive and commonly used business plan software for salons.

How Do You Get Funding for Your Beauty Salon Business Plan?

Raising funding for a beauty salon can be achieved through: SBA loan, bank loan, angel investors, friends and family or salon owner financing.

Owner financing means you pay a portion of the total cost for purchasing the business upfront, and make payments for the remaining balance over an agreed upon timeframe.

Major Milestones and Salon Business Goals

Major salon milestones would be: expanding to the empty space next door, adding a new location, offering more benefits like insurance or expanding your service menu. Thinking through where you want to be in X number of months or years will help you set salon business goals.

Salon Milestones Example

Milestones are a great way to outline your salon’s success goals. You can include a detailed financial plan, or just set dates to serve as a living document of where you want to be in the future.

Get the best milestone planner with LivePlan- 40% off for one year with our special offer here.

We hope you found our salon business planning tips helpful! Salonspa Connection is here to provide a comprehensive resource platform for all of your business needs.

We may earn commissions on affiliate links included in this blog post, at no additional cost to you. Thank you for supporting our blog!

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The Salon Booth Rental Guide 2023: Win-Win Space Sharing

Whether you’re a salon owner or stylist, salon booth rental offers a unique way to bring in extra income.

In this post, I have summarised the most important parts of the salon booth rental business. 

I have also added valuable tips on how to automate your booth rental system. This can help you decide whether you should charge a monthly fee or take a commission. This tip alone could save you thousands of dollars.

This guide includes the following:

What is Salon Booth Rental? 5 Ways a Salon Owner can Benefit from a Booth Rental System 5 Benefits for Stylists of the Salon Booth Rental Model How Can I Make Money With My Booth Rentals? Automate Your Booth Rental Program with a Salon POS Conclusion – Now is a Great Time to Try Booth Rental

What is Salon Booth Rental?

Salon booth rental is a business model that involves two parties directly benefiting from the arrangement. A stylist will lease salon space to provide hair services, and the salon owner will receive income from the temporary tenant. The stylist pays a fixed recurring fee and/or a percentage of their sales.

This arrangement benefits both parties because it can reduce costs and add revenue for both the stylist and the owner.

The agreement specifies the terms of the rental arrangement, such as how much the salon vendor will pay per month, how long they will rent the space for, and what services they are allowed to provide from that location. The agreement should also include a clause specifying what will happen if either party decides to terminate the contract early.

5 Ways a Salon Owner can Benefit from a Booth Rental System

If you’re a salon owner, renting chairs to stylists can be a great source of steady income. Here are some benefits of this business model.

• The owner can start making money immediately
• There are no or low start-up costs involved
• No benefits to pay like health insurance plans, 401 programs, or paid vacation days
• Provides easy-to-predict passive income each month
• It’s straightforward to set up with the right salon software

5 Ways Stylists can Benefit from the Salon Booth Rental Model

So which option is better for you: rent a booth, work as an employee, or start your own salon? There’s no correct answer. All options have advantages and disadvantages. To help you make the best decision, here are some benefits of renting a booth.

• It’s a low-cost way to start your own business without setting up your own expensive location
• Only pay a fixed monthly fee or a small percentage of your earnings and keep the rest
• Be your own boss and get paid more (or at least have the possibility to do so)
• Set your own schedule and have your own clients
• No need to hire employees

How Can I Make Money With My Booth Rentals?

Booth rental businesses can make money in several ways. The most common way is through monthly fees charged to booth stylists. Another option is to charge a set amount per hour. This can work well for salons where stylists work long hours, but not for salons that only operate during specific times. A third option is to charge a percentage of each stylist’s commission.

When renting out a booth at a salon, do you charge a monthly fee or take a commission?

Both options can be lucrative, but choosing which will suit your business model best depends on your accounting habits and business goals. When renting, you’re more likely to live comfortably with an even amount of income. However, if you opt for commission, you may end up making much more money if your renters are talented and bring in an ample income.

So far, a large majority of salon owners have opted for a fixed monthly fee. This is partly because the commission or percentage model requires more administration and accounting.

However, good salon software can automate commission sales.

Deciding on the Rental Rate for a Salon Booth

Renting out booth space in a salon opens up a whole new source of revenue. You need to decide on a profitable rental price point yet low enough to attract stylists who want to work with you.

If you can’t find enough stylists, consider offering more amenities or updating your location, so it appeals to more customers. If you have too many stylists interested in booth rental, remember that you can always raise the rates.

Automate Your Booth Rental Program with Salon POS Software

Booth rent collection is a time-consuming and tedious task for salon owners. But Salon POS software can automate it easily. With this feature, booth owners automatically charge their rent and fees to booth renters. There’s no need to use cash or checks, and the software makes the process easy to track.

Here are some examples of use cases to look for:

Make onboarding a breeze  and welcome your new salon booth renters with a prompt text or email. Send them their rental agreement and payment information, and they can enter it directly. With the payment information stored automatically in their employee profiles, stylists and other new booth hires can access it instantly.

Easily create legally binding documents . Your renters are entering agreements with you. How do you make sure they sign the right ones? Create legally-binding contracts for salon booth rental using forms. In this way, the renter’s agreement is accessible in a transparent and trustworthy manner.

Collect rent automatically . With the automation of rent, your business will never have to worry about chasing stylists, cosmetologists, or others for checks or cash again. Eliminating confusion over due dates is one less hassle on your plate.

Deduct commission from rent . Make it easier for your stylist by automatically deducting their product sales commission from their rent. This will save you time during tax season and stop confusing your independent contractors with 1099 forms. It’s a simple switch that saves salons time, money, and paper.

Rental payment information and history.  The stylist can easily see their payment information and update anything different. They can also find the booth rental agreements in the employee profile.

Mangomint makes it easy for salon owners to manage their booth renters with their seamless payment integration. With Mangomint Pay, salon owners can create different payment accounts for each service provider, ensuring all service sales are automatically routed to the appropriate bank accounts.

By using Mangomint Pay , booth renters can easily manage their own payments and track their earnings, giving them more control over their income. This not only benefits them but also benefits salon owners by reducing the administrative burden of managing multiple payment accounts.

Additionally, Mangomint allows you to create custom forms for your booth renters to sign. You can create these forms in Mangomint and have your booth renters sign them electronically.

Mangomint also allows you to track your booth renters’ performance by providing detailed reports on their sales and services. You can use these reports to see if your booth renters are bringing in their own clients or not.

Conclusion – Now is a Great Time to Try Booth Rental

Booth rental can generate more income for salon owners by allowing them to get paid for areas that might otherwise go unused. Still, it can also enable stylists to start their own businesses and work without the overhead costs of owning a physical space.

Automation is the key to running a successful salon business, and the old way of collecting rent with cash or checks is time-consuming and challenging to keep track of. But it’s easy with a good salon POS with features for managing a booth rental program.

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John Hallberg

Beauty marketing expert and content creator at The Salon Business and Mangomint

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A Guide to Salon Booth Rentals for Stylists and Owners

There is a lot that happens behind the scenes when operating a successful hair salon. People may not realize all that goes into recruiting and retaining high-performing stylists, while also allowing owners to benefit from their investment. This guide focuses specifically on salon booth rental for stylists: how it works and how renters and owners can maximize their agreements.

What is a salon booth rental?

A booth rental salon is a type of salon in which stylists rent out individual “chairs” or salon stations from a salon owner. The establishment may or may not be stocked with supplies—this varies by salon. But a hairstylist can expect at least a salon chair, a mirror, a hair-washing sink with running water, and basic workplace requirements (e.g., Wi-Fi, heat, and air conditioning).

A newer variation of booth rental salons is the salon suite . Stylists rent a fully stocked suite and run independent businesses alongside other renters.

Managing a booth rental salon is one of many options. Some business owners manage employee-based establishments offering commission, salary, or hourly wages. With a commission model , stylists earn a commission percentage of the business they bring to the salon. Some salons have both renters and employees working side by side.

Salon booth rentals for stylists

With employee- and commission-based salons, stylists don’t have to cover the costs of their workspace, as they would in a rental system. However, they may have less authority over certain salon-wide decisions such as branding, interior design, or marketing strategies. This guide will cover the pros and cons of renting a salon chair, plus common questions and tips.

Pros of renting a salon chair

More independence: Renters can manage their schedule, choose the products they like, and set their own prices.

No need to pay utilities: Typically the salon owner covers the cost of utilities such as Wi-Fi, water, and electricity.

Lower maintenance: Renters have responsibility for their own booth, but the owner usually handles upkeep for the larger salon space (i.e., the bathrooms and waiting area).

Possibly marketing support: The owner may have a marketing or social media team that handles salon marketing, which helps stylists get connected with new clients.

Cons of renting a salon chair

Business logistics: A renter is running their own salon business; this means being responsible for customer service, billing, business taxes, and other logistics.

Overhead costs: The provider has to buy essentially everything but utilities; this includes products for all styling and services, tools, marketing, education, and possibly a salon assistant.

Marketing and social media: Even if an owner has their own salon marketing tools, the individual stylist usually still needs to build an online presence to find (and keep) clients.

No insurance or retirement: Unlike employees, renters don’t have built-in insurance (health, disability, and liability) and retirement plan options; these must be entirely self-funded.

Expenses associated with running a salon booth

Which expenses stylists cover depends on the salon. When considering a salon booth rental vs commission system, ask the owner which supplies are provided for renters and which the renter has to bring. Does the rental include styling tools? Do stylists bring their own products? How about towels? Does the salon let renters use office supplies: Wi-Fi, a phone, and a printer? All of these can become significant expenses for the renter.

Also ask if renters are responsible for marketing their booths — a small financial expense, but one that’s costly in time. Does the salon support their efforts or offer salon marketing tools? Does the salon require renters to participate in their salon marketing efforts?

How to find the right salon booth rental

Finding a good-fit salon can take time but the right space, location, and community is worth the effort. Some considerations are common to all workplaces: How far is the commute? What are the benefits? But a stylist should ask several salon-specific questions when considering a booth rental. As a starting point, make sure you understand or observe:

Does the salon offer any incentives, such as commission toward retail sales?

What is the salon marketing policy? Do renters have to contribute?

What do current renters say about the ownership?

What is the stylist community like?

Are there educational opportunities for renters?

How does the salon space look and feel?

Is the location convenient for clients? Does it get foot traffic?

For stylists with an established clientele, will you lose customers if you move?

How to set up your salon booth rental

Renting a new booth is exciting — and exhausting. To help, we created an entire set of supplies needed to set up a salon booth rental for hairstylists. This list does not include the supplies that the owner typically provides, such as display shelves, waiting area seating, lighting fixtures, and washing sinks.

Styling tools: Hairdryer(s), flat iron, curling iron/wand, diffuser, hair rollers

Cutting tools: Combs, scissors, razors, clippers, and trimmers

Hair care products: Treatments (e.g., serums and oils), shampoo and conditioner, performing and relaxing products, styling and finishing products

Hair color products: Hair color, developer, toners, gloss and glazes, bowls, brushes, foils, and gloves

Hair accessories: Clips, headbands, hairnets, bobby pins, extensions and associated supplies (e.g., clips, glue, or tape)

Salon supplies: Salon capes, spray bottles, towels, disinfecting solution, and cleaning supplies

Salon booth rentals for owners

Operating a rental salon specifically will require the owner to invest significant time and energy or to hire a strong operator to manage the business. Owning a salon can be a good business opportunity, especially for those with industry experience and/or a desire to mentor future stylists. But the disadvantages, elaborated below, can be frustrating.

Pros of running a booth rental salon

Fewer employee expenses: Employees are independent contractors in a booth rental, and the owner typically does not pay for employment taxes, retirement, or health insurance.

Consistent income: Renters provide consistent income for the salon that can be poured back into the business.

Less social media required: Stylists usually run their own social media accounts, which relieves some of the burden on the salon to market itself.

Cons of running a booth rental salon

Marketing to stylists: The stylists recruit clients, but the salon has to recruit stylists. This often requires the owner to invest in a salon marketing strategy and branding in competitive marketplaces.

High turnover costs: Turnover can be high in the beauty industry, and salon owners have to absorb the costs of recruiting, training, and possible re-dos for more junior stylists.

Managing independent service providers: The salon owner has little control over the actions of booth renters unless they have a solid contract stating otherwise. It isn’t easy to let go of a booth renter who is tarnishing the salon’s reputation.

High overhead: Salons aren’t cheap to run; the owner covers all costs associated with the space: building insurance, property taxes, maintenance costs, utilities, and more.

How to set up and stock salon booth rentals

Potential owners might wonder, “What does a salon booth rental include?” There is no right answer, but a salon owner might start with informal interviews with stylists in their network. Try asking:

Which supplies are need-to-haves in a salon booth?

Which supplies are nice-to-haves?

What perks would compel you to choose one booth rental salon over others?

What perks are commonly offered but not compelling to stylists?

What do stylists expect from rental salon marketing specifically?

Supplies and perks are added expenses, of course, but these thoughtful touches can help a salon attract seasoned stylists in a crowded market. Also, consider whether you will supply styling tools and products. At hair salons, stylists typically have personal preferences and bring their own.

As an owner, keep in mind that some basic supplies are effectively required. For hair salons, this list includes salon chairs, mirrors, hair-washing sinks, and utilities, at minimum. Providing towels and laundry service is helpful. Other attractive investments include appointment scheduling software as well as a regular cleaning service for the bathrooms, waiting area, windows, and overall space.

Legal considerations for salon owners and booth renters

Renting a salon chair or booth is a business partnership with legal implications defined below. Of course, stylists and salon owners should consult their legal advisors for specific, personalized advice.

What is a salon booth rental agreement?

Salon owners and booth renters are in a tenant/landlord relationship, which is governed by state laws. The Behind the Chair blog notes that a salon booth rental agreement could be either a written lease agreement or a rental contract. A written lease gives the stylist independent tax status, sets a start and end date, and states the rental fee and included amenities.

A rental contract tends to be fuller and may:

Grant the stylist exclusive use of a salon booth and its amenities (e.g., a chair, mirror, electric outlets, storage space)

Give the stylist access to shared spaces, including the hair-washing station and the restrooms, as well as appointment-booking technology

Lay out community expectations, such as displaying a license, holding liability insurance, and keeping the booth area tidy.

What are salon booth rental rules?

Booth renters must abide by the “rules” laid out by the salon owner, usually in the salon booth rental agreement. These stipulations could be about maintaining the space, such as sweeping up hair and washing out foot baths. They could also cover technical matters, such as requiring renters to keep their own books.

What is salon booth rental insurance?

Stylists that rent space in a salon should hold salon booth rental insurance. Their lease or rental agreement may even require it. Booth insurance is typically an add-on to liability insurance, which protects hairdressers, cosmetologists, and barbers against lawsuits or claims about services provided. Booth insurance isn’t a luxury, according to the National Association of Barbers . The policy ensures a stylist is covered when unpredictable accidents happen, because the salon’s policy may not cover them.

Commonly asked questions about booth rentals

Do employees bring their own devices.

Stylists: Check the salon booth rental agreement, which likely notes whether or not you are responsible for your own tools.

Salon owners: You get to decide whether your salon provides renters with devices such as heat styling tools and hairbrushes. Stylists, especially seasoned ones, likely already have preferred tools and will bring them. But providing them can be a perk that attracts booth renters, especially for new stylists.

Who brings the supplies in a salon booth rental?

Operating a hair salon booth requires much more than devices. The stylist also needs scissors, combs, brushes, rollers, foil, hair treatment chemicals, and more. The stylist and owner together should consider not only who brings the supplies but also who re-stocks them and who covers the costs. Knowing these details ahead of time can reduce tension later.

Where can a salon owner find stylists for hire?

Salon owners can find talented stylists in their communities in several ways:

Create job postings on general job boards such as Indeed and LinkedIn or on specialized beauty industry websites.

Ask for referrals from your network of friends and colleagues but also acquaintances; try asking around in unexpected places, such as children’s sports events or high school reunions.

Expand your network by attending trade shows, conferences, and other industry events.

Check with local beauty and cosmetology schools , which may host job fairs and/or maintain a network of alumni and new graduates seeking work.

Social media and online platforms for beauty professionals can also match stylists with salon owners.

There’s a single tool that can minimize your risks and maximize the rewards.

Salon booth rentals can be profitable, even enjoyable, for both owners and stylists — but only when managed well. Investing in appointment scheduling software can smooth out operations and refine the business. Try out DaySmart’s solution free for 14 days, or get in touch with our sales team today .

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08.21.2023 12 min read time

Your Ultimate Guide To Salon Booth Rental (How To Make Money Renting The Chair)

• Businesses/Owners

Many beauty and grooming professionals are drawn to the salon booth rental for a number of good reasons.

If you’re a hairdresser or barber, renting a booth can give you more freedom compared to working full-time at a traditional salon.

Meanwhile, if you’re an owner or manager, you could enjoy increased stability and potentially lower costs.

A booth rental salon business can be attractive and rewarding, but it also comes with challenges.

Like with most business ventures and careers, you need to determine if it’s a good fit for your style, goals, and personality. And if you decide to go down the booth rental route, it’s important to figure out the best strategies to grow your business or career.

And that’s exactly what we’ll tackle in this post.

Below, we’ll dive into the world of salon booth rental. We’ll look at the pros and cons of this business model and offer best practices for success.

This article has sections for both owners/managers and renters. So whether you’re someone who’s running the booth rental salon or you’re renting a chair, you’ll find some useful information below . 

What is a salon booth rental?

Salon booth rental is a business model in which the salon or barbershop earns revenue by renting out chairs in the location. Unlike traditional salons or barbershops, a booth rental business doesn’t employ the stylists. Instead, they’re treated as renters.

How to run a booth rental salon [for owners/managers]

Pros and cons of owning or running booth rental-based salon.

Owning or running a booth rental salon comes with some advantages and disadvantages. It’s important to be aware of these pros and cons so you can figure out if salon booth rental is the best path for you.

Pro: You have a more hands-off approach to HR 

When you’re renting out chairs, you essentially have a landlord-tenant relationship versus an employer-staff relationship with the people working at your location. As such, you don’t have to actively manage them or their work.

There’s no need to monitor attendance, fill out employee tax forms, or do any heavy HR tasks, so you’ll have more time and resources that you can use in other areas of your business.

Pro: Reduced costs in certain areas of the business 

You could also potentially lower your costs, at least when it comes to manpower. Unlike salons that pay full-time employees, you don’t have salary costs and there’s no need to pay for employee benefits.

Those who rent booths at salons and barbershops typically use their own products and supplies, so you may find cost savings there as well.

Pro: Relatively more stability income 

When you’re running a commission-based salon, your income may vary widely depending on how many clients you get. With a booth rental establishment, your income is relatively stable because you’re able to collect a fixed amount of rent regardless of how many clients have walked through your doors .  

Con: Less control over people and how the salon is run 

Renters at salons and barbershops aren’t your employees, so you have limited control over how they perform their work. You don’t have a say on what products they decide to use or how they choose to administer their services.

This isn’t necessarily a bad thing if you like the hands-off approach. But if you prefer being in control of the day-to-day activities of your salon, then booth rental may not be right for you .

Con: The team may not be as unified as those who work full-time

Commission-based salons that employ stylists or barbers can initiate team-building efforts, plus the people working there are around each other on a consistent basis. This leads to stronger employee relationships.

Achieving that level of unity is more difficult for booth rental salons.

People who rent chairs are running their own independent operations, so they’re looking out for their businesses first. And since they keep their own schedules, they may not be around as much. All that leads to a less unified team.

Con: Lack of brand consistency

Since your chairs are being rented by independent stylists, each individual has their own style and ways of doing things. This can lead to a lack of consistency when it comes to your salon’s brand experience.

This isn’t much of an issue if you simply want to collect rent and you’re not interested in building a brand. But if you do want to create a name for your salon, then a booth rental set up isn’t the best choice.

Best practices when running a booth rental salon

Now that you have an idea of the pros and cons that comes with running a booth rental salon, let’s look at the ways on how to do it effectively.

Know your rent numbers and keep expenses under control

Unless you own the building or space, you’re likely paying rent on your location. If you want to stay profitable, you need to keep your rental expenses under control. According to Randi Rose, co-founder at Thrive Business Services, if you’re running a booth rental salon, “you want your rent to be no more than 25% of your expenses.”

So, run the numbers in your business. Calculate your rent against your other bills and make sure it’s not taking up over a quarter of your expenses. If you discover that you’re spending too much on rent, then you can find ways to either lower your expenses or cook up ideas to bring in more revenue.

Craft a solid renters agreement

Come up with a solid contract for your salon booth rental. The specifics of this will vary, depending on your location and type of salon but generally, the following components should be outlined in your agreement:

• Term of the agreement (i.e., fixed lease, month-to-month, or week to week) 
• The rent amount 
• The use of premises (i.e., how the space should be used, what’s allowed, what’s not permitted)
• The equipment and property that you’ll provide and what you won’t provide
• Salon booth rental rules of conduct, cleanliness, etc.
• Expenses that you’ll cover (i.e., utilities, taxes, maintenance, etc.)

If possible, have a legal professional go over your contract before handing it off to renters. The goal is to create a fair agreement between the two parties.

Build good relationships with your renters

Earlier, we discussed that one of the drawbacks of having a booth rental salon is the lack of unity among stylists . While it’s true that you can’t impose employment rules on your renters, you can still promote a sense of unity by building healthy relationships with them.

This starts with choosing renters who are a good fit for your salon. Interview different stylists and get a feel of how they’ll fit in with your personality and with other barbers or hairdressers in the space. You want people to get along, even if they’re working independently.

And once you have people renting, make an effort to get to know them and strive to foster a work environment that encourages people to collaborate or at least be friendly with each other.

Here’s an example from LePosh Hair Studio that seems to have mastered it as evident from the image below:

Doing so improves the atmosphere in your salon and promotes unity, ultimately benefiting everyone including the customers who walk through your doors.

Give them a hand

While you’re not strictly required to do so, consider assisting stylists with marketing or running their business. Make things easier by providing backup equipment or products in case they run out. You could also provide mentorship opportunities to improve their craft.

If your business has an Instagram page , consider promoting the various stylists renting at your salon or barbershop.

You could also help them with managing their calendar. One way to do this is to set them up with salon scheduling software so their clients can easily book appointments. You can give them a link to their portal that they can easily share.

Why go through all the trouble? Simple: showing stylists that you have their back builds loyalty. They’ll stay with you longer and be better tenants overall — and that’s great for your business.

Remember: when your tenants succeed, YOU succeed with them.

How to succeed as a salon booth renter [for freelance/independent stylists]

Pros and cons of renting a chair.

If you’re a stylist considering salon booth rental, here are some of the top pros and cons to factor in.

Pro: More time flexibility 

The biggest draw of salon booth rental for stylists is the schedule flexibility that it affords. If you’re a salon booth renter, you have control over your hours and vacation days . You won’t have a boss looking over your shoulder and there’s no need to clock in and out of work. All that can be incredibly attractive, particularly if you prefer to have a flexible lifestyle.

Pro: You keep more of what you earn 

Traditional salons that employ stylists typically offer commissions on top of their salaries. Commission structures vary from one salon to another, but they usually range from 35% to 60%.

If you’re an independent stylist, you don’t have to worry about commissions. Instead, you earn gross revenue from the services that you provide. This can potentially lead to higher income.

Pro: More freedom with how you serve clients

When you’re an employee, you need to play by the salon’s rules. You have to use the products they sell and you may feel limited in terms of the types of services you can provide.

If you’re a renter though, you have a lot more freedom with your work. You’re able to use your favorite products and your own supplies. Plus, you can build your personal brand as opposed to marketing the salon as a whole.

Con: It takes more work to be a booth renter

When you rent a booth, you’re in charge of your own business — and that comes with more work than being an employee at a salon. As an independent stylist, you file your business taxes (which are a lot more complicated than employment tax filing) and you have to worry about health benefits, marketing, supplies, etc.

If you’re up for all of that, then great. But if the thought of going through all the admin work doesn’t appeal to you, then the rental route probably isn’t the best fit.

Con: Your income can fluctuate 

One of the biggest advantages of being an employee is that you’re subject to a guaranteed wage every month. While your commissions may vary, your employer is required to pay you minimum wage at the very least. That provides some financial cushion regardless of how many clients you serve.

This isn’t the case if you’re renting a chair. The amount of income you earn is directly proportional to the number of customers who sit on your chair. That’s all well and good if you have a steady stream of clients. But if your business goes through a slump, your income will take a hit.

And remember, rent is still due every month, so you should always have financial reserves in the event that your monthly income can’t cover your expenses.

Con: You must purchase all the tools and products you use

The salon where you rent isn’t required to provide you with products or supplies beyond the actual chair or booth. You’re in charge of purchasing styling products and maintaining your equipment, so you have to budget accordingly.

Be aware that while you are keeping more of what you earn, you also have more expenses.

Best practices for stylists renting a chair or booth

If you decide to pursue the booth rental route, here are some tips on how to successfully manage your independent business.

Select the right location

There are many factors that come into play when evaluating the right salon. Let’s start with the biggest one: location. When deciding where to set up shop, you need to think about:

Your clientele. What types of customers are you after? Where do they live and work? For obvious reasons, you need to select a salon that’s located in areas that your customers frequent, so iron out your client personas before signing a rental agreement.

Your budget. Salon booth rental prices can be as low as $250 , but can also go up to $1,200 a month. It’s a wide range, to say the least. The amount you’ll pay will largely depend on the location. Salons or barbershops that are in high-end, high-traffic areas can command higher salon booth rental prices than those in less-than-ideal locations.

Make sure the salon is a good fit for your style

Choosing the right salon isn’t just about location or rent. You should also consider the atmosphere, people, and overall feel of the place. Is the salon’s environment and design appealing to you and your clients?

Vier Hair Loft, for example, offers a space that works well for stylists who need a creative edge.

What about the other people in it? While it’s true that your landlord isn’t your boss and other renters aren’t technically your co-workers, you’ll still spend a considerable amount of time in the location. You want to make sure that you’re comfortable.

Keep your business ducks in a row

Being an independent stylist or barber comes with more paperwork and responsibilities, so be sure to stay on top of your business.

Review your rental agreement and make sure everything is in order. Be organized and meticulous with your paperwork and other records. This is particularly important since you’ll be filing taxes for your business. If possible, get yourself a good accounting or bookkeeping app to keep everything in check.

Arm yourself with the right tools and solutions

When you work at a salon, your employer will provide you with the tools you need to do your job. This may include styling products, equipment, even software like payment processing and appointment scheduling.

When you’re renting a chair, all that becomes your responsibility. So, it’s important to select the best products and solutions for your biz. As a barber or hairdresser, you probably have favorite hair styling brands, which is great, but what about the tools you need to manage your business?

Appointment scheduling software , for example, is critical. Select a booking app that allows your clients to conveniently book your services.

Consider Booksy , which is loved by numerous independent stylists because it offers all the features you need to stay on top of your appointments. In addition to having a booking link that you can add to your website and share with clients, Booksy lets you take bookings directly from Google, Instagram, and Facebook.

Booksy also integrates with payment processors like Stripe and Square, so you can collect deposits and accept multiple payment types including cash and credit cards.

And remember when we talked about staying on top of your records? Booksy helps you do just that with insights. The software sheds light on your appointment history as well as a performance dashboard so you know which clients and services are bringing you the most revenue.

Continuously market your biz

One of the benefits of being a salon employee is that the company takes care of marketing the brand and bringing in clients. This isn’t always the case when you’re a salon booth renter . While your salon may help with marketing, the bulk of the work rests on your shoulders.

We talked about salon marketing in-depth on the blog, so here are some quick tips with links if you want to go deeper:

• Implement Instagram marketing by posting content and engaging with your audience.
• Keep clients updated and stay top of mind with email marketing.
• Promote your business locally and increase your presence in your neighborhood.
• Explore and test various marketing ideas, including promotions, loyalty offers, and word-of-mouth marketing. There are tons of options; you just have to find the best fit for your biz. 
• Create a content production machine to beat your competition

Salon booth rental: is it right for you?

Salon booth rental can be a flexible and lucrative path. It’s not for everyone, but if you have the working style and personality for it, you’ll find it to be incredibly rewarding. We hope the insights above gave you some clarity on whether or not it’s a good fit for you.

And if you are looking for a tech partner who can help you navigate salon booth rental with ease, get more bookings , and make your business grow, try Booksy for free . With tons of features, we’ll help you stay on top of your business growth, without spending hours managing it. 

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• Business Tips

How to Write a Hair Salon Business Plan

Are you thinking about opening your own hair salon? Or maybe you already have a salon and are thinking about opening another location?  

Well, when it comes to opening a new salon business, knowing how to write a hair salon business plan can make or break your success. The good news is—we’re here to help. 

In this article, we’ll go over the ins and outs of creating a hair salon business plan. This includes everything from market analysis and financial projections to your goals for the future. Having a plan will help you obtain funding and stay on track as you grow. 

Let’s get started. 

Do I Really Need to Write a Business Plan for a Hair Salon?  

You wouldn’t drive from San Francisco to Boston without either a GPS or a map, right? So, you shouldn’t run a business without a plan either. 

A hair salon business plan is a roadmap for your beauty business. Whether you have two chairs or 200, it’s essential for your ongoing success. 

In fact, opening or expanding a business has a lot more at stake than a drive across the country. You may have saved or taken out a loan to start your salon. And you likely have employees or contractors who are dependent on your business sense, too. 

A business plan gets you organized when you’re first starting out or opening a new location. Plus, it keeps you on track as you grow. You can reach or exceed your goals, but you must know what they are first. And you need to have a detailed set of strategies to use along the way. 

Let’s go back to our road trip metaphor.  

Suppose you want to get from California to Massachusetts. First, you figure out how many miles or hours the journey will take. Then, you divide that by how many miles or hours you can comfortably drive in a day. That’s how many days it will take. Finally, you plan overnight stops along the way for each of those days to make the drive doable. 

A salon business plan isn’t much different. You probably have goals for things like: 

• How much gross income you want to bring in 
• How much profit you want after overhead and labor 
• Ideal business model structure (e.g., booth rent vs. commission) 
• Services you would like to offer clients 
• Places where you’d like to open additional salons 

Without a specific business plan for how to make them happen, those are just pie-in-the-sky dreams. You need a more granular approach to turn them into a reality. 

For instance, how much money do you need to make each month to reach your desired net profits? If that’s how much you need to make each month, what do you need to make daily, assuming you’re open five days per week? How many chairs do you need to have? At what capacity do you need to operate? 

Not to mention, you’ll almost certainly need a formal business plan if you want to get financing for your salon. Salon equipment and real estate can be quite expensive. A bank may loan you money to get set up, but only if they see you have done your homework first. 

Lenders don’t want to back a business that is more likely to fail than to succeed. And new hair salons have an average success rate of 50% in the first three years of operation. 

That means half of those businesses will fail. Most fail not because of a lack of talent or ambition but because the owner doesn’t know how to properly run a business. You can be the best hairstylist in the world. But if you consider things like business accounting and marketing, you will likely lose more money than you are bringing in every month. 

Do you want to be in the 50% of new salons that thrive? Keep reading to learn the step-by-step method of developing a business plan for your salon. 

RELATED ARTICLE:  

Owning a Hair Salon: Your Launch Guide  

How to Write a Hair Salon Business Plan: Step by Step  

Below you’ll find information on each section commonly included in a business plan. But first, here’s a tip to help you make the most of these categories. 

Use the SMART method for setting goals. What are SMART goals ? They are: 

• Specific – highly detailed, not vague 
• Measurable – able to be quantified with hard numbers and actionable items mapped out to achieve the goal you’ve set 
• Achievable – doable within the framework of your business model 
• Relevant – related to your salon today, not somewhere else or too far in the future 
• Time-bound – tied to specific dates for end goals and milestones 

Any time you set a long-term or short-term goal, ask, “Is it SMART?” If not, dig deeper to get the details you need to make it work. 

Executive Summary  

Think of the executive summary as the introduction to your salon business plan. It gives brief information about: 

• The purpose of your salon and who it will serve 
• Your business objectives (offer something novel, expansion, etc.) 
• How your salon will be different from your competitors 
• Why you think the business will perform well 

For instance, you could talk about how you plan to open a salon in a busy urban area to cater to downtown employees. Your client demographic is primarily white-collar workers aged 25 to 45. 

Your unique selling proposition , or USP, is what makes the salon special. Say it’s that it will offer 20 and 50-minute appointments to fit into standard lunch breaks. Additionally, you’ll have 10-minute appointments for fast services during coffee breaks. 

Customers can get a quick trim on their fringe or ends. Beard and mustache trims are another rapid service you will offer. Everything can be booked and paid for online to streamline the process and get customers in and out in a jiffy. 

Maybe after work hours, your salon will be open for more traditional appointments. And you’ll have more quickie services available for businesspeople going out at night. They can get an updo, blowout, or style refresh before a date. On Fridays, you’ll offer manicure services too. 

In your business plan, you’d want to outline howyour USP will help your salon be successful. For our example, you might say you believe the salon will do well financially because of three factors: 

• The area is currently underserved by hair salons. 
• You are catering to the needs of businesspeople in your locale. 
• You hired an experienced stylist who’s bringing their clients with them. 

You don’t have to get into a ton of detail yet. This is a proverbial bird’s eye view of your business proposition. You could, however, outline a rough roadmap of how you envision your business will start and where you see it going in one year and five years. 

For instance, perhaps you plan to start with one location and 10 chairs. Five years from now, you want to open two additional locations. At that time, you will add new services like brow waxing and makeup consultations. 

You can mention market analysis in this section, too. Market analysis looks at competition and consumer needs in your niche. However, there will be a place later in your business plan to address this in more detail. 

Remember, your executive summary is an investor or lender’s first impression of your salon business. Therefore, you want to make it shine. 

Company Description  

This section goes into detail about the structure of your company. How long have you been in business? Who are the owners and managers? 

You’ll also want to review how many employees or contractors you plan to have. Will they be employed under W2 status, or will they contract as 1099 workers? 

Will hair stylists pay you a fee for the use of a chair? Will your salon take a cut of their fees? How will tipping be structured? 

For example: 

• Our salon is a startup organization that is not yet in business. 
• It is co-owned by two stylists who participate 50-50 in leadership. 
• There will be 10 chairs in total in the salon. 
• Eight contract stylists will be working as 1099 independent contractors. 
• Contract stylists will pay a monthly chair rental fee and a percentage of their billables to the owners. 
• All tips will go to the employed stylists, with a percentage going to a shampoo assistant. 
• Contract stylists make a commission on products sold in the salon. 
• You will also have two paid receptionists who will be W2 employees. 

You will go into more detail about financials in the Services and Pricing section. But this section should give readers an understanding of the basics of your planned salon operations. 

You can also include funding or investing requests in this section. Again, you will have further opportunity to dive into financials later. But touching on what you need to open or expand gets readers primed as they go through the next four sections. 

Market Analysis  

The market analysis section of your business plan is another area where you can wow readers and make your salon stand out. It answers the question, “Why you, and why now?” 

Remember, you don’t want to fit in with all the other salons in the area. Instead, you want yours to be unique . 

Your hair salon might be unique because of its business model, like the hypothetical one described in the executive summary. Or it could be you have a string of well-known stylists. 

Perhaps you offer extra luxury services and product lines. Maybe you offer great prices. It could be the whole vibe of your salon that’s one of a kind. Maybe it’s a retro nod to the ‘70s or a high-tech glimpse into the future. 

You don’t want to pitch your salon with a kitchen sink-style of features. After all, when you appeal to everyone, you really appeal to no one. But you can list several unique attributes that will give you a competitive market edge. 

In this section, you’ll show what the current market is like in your location. How many other salons are within a mile or two? Who do they cater to? Is there a gap you can fill to capture more market share? 

Be realistic. If everyone who comes through your door is on a tight budget, you can’t offer $300 color jobs. You need to match your services to your demographics. 

If you’ve ever sold a real estate property, you’ve done something similar to a business market analysis. You or your agent prepare “comps” or comparables. The comps show how your property is special, while reviewing what the rest of the area has to offer. 

Whether your salon is brand new or you’re opening a new location for your existing salon business, you may need to conduct market research. You can do this on your own or hire a consultant to do it for you. 

The more populated the area in which you operate, the more complicated market research is likely to be. If you’re in a suburb or rural community, there may only be a few hair salons to compete with. 

Don’t forget to include how your USP and ability to fill a need relates to industry trends. Let’s use the example above. There is a current national trend towards more online conveniences for salon customers. So, offering online payments and booking is going to help you stay at the front of the curve. 

Also, employees are feeling busier than ever these days. They struggle with work-life balance. And many are returning to the office after working remotely for several years. 

Your salon leverages this trend as well by providing stress-free quick appointments that fit into work breaks. Workers can get their hair done over their lunch hour and make better use of their personal time after work. 

If you have an existing business that you’re expanding, you can survey your clientele. Maybe you’re going to a second location because it’s underserved. Or perhaps you’re adding more services because that’s what clients want.  

It’s great to be able to give objective data that says there’s a need for your services. 

Hair Salon Industry Trends for Growing Your Salon Business  

Marketing Strategy  

How do you plan to promote your new salon or additional location? That’s the focus of this section of the plan. 

Some common salon marketing methods include: 

• SEO website 
• Social media accounts 
• Paid advertising 
• Loyalty programs 
• Cross-promotion with other businesses 
• Flyers in area office buildings 
• Bulk mailings with coupons 
• Free makeovers 
• Local news editorial coverage 
• Online review platforms 

An SEO (search engine optimized) website is a great place to start promoting your business. You can add other components later. An optimized website is set up to rank higher on search engines like Google and Bing. 

How do you improve a website’s SEO? 

• Use keywords related to your exact services that clients would search for when looking for a hair salon. 
• Be sure to mention your location multiple times on the website, including your state and local landmarks. 
• Add a blog for value-added content with links to authoritative sources. 
• Get your salon mentioned on other websites and in social media mentions. 

This section overlaps with your market analysis. You’ll be using your unique selling proposition to focus marketing campaigns. Every marketing effort is an opportunity to promote what makes your salon stand out. 

Talk about how you plan to cement the two cornerstones of a healthy salon business: 

• Repeat customers who book appointments regularly 
• New customers who keep things fresh and balance natural attrition 

How to Design and Roll Out a Beauty Salon Rewards Program  

Management and Organization  

Here’s where you can go into more detail about your salon’s company structure and staff payment plan. You can include elements like credentials here, particularly if you or a manager have a business background or education. 

Don’t simply list how you plan to pay workers. Explain why this is best for your salon business’s long-term financial health. 

Are you and any other owners taking a salary? What corporate structure are you using (LLC, S corp, etc.)? Your state may determine how you want to set this up.  

Speaking with an accountant can clarify questions for you, especially about taxes. 

Services and Pricing  

This section of your hair salon business plan outlines the meat and potatoes of what your salon will offer. It is essentially a menu of all the services and treatments you provide. It also includes prices for each. 

You can mention why you chose the pricing model you did. For example, if you’re serving affluent clients in a resort area, you can justify charging a little more. Or you might do group pricing because you serve a lot of bridal parties. 

Don’t forget to add any products you plan to sell. Why is carrying these items beneficial to your business? 

Financial Projections  

Financial projections are the nuts and bolts that lenders want to see. They’ll also keep you on the right path as you grow your salon. 

You’ve already outlined your services and pricing. Now, it’s time to do the math and calculate what that means in terms of income. 

Answer these questions first: 

• What do you expect your salon to gross (total income) in a year? 
• What are your overhead expenses (rent/mortgage, staff, utilities, wholesale supplies, etc.)? 
• What portion of your expenses are due to payroll? 
• Do you have to make capital purchases for equipment? Will these be paid with a lump sum, financing, or rental payments? 
• What is the net profit you expect (gross income minus overhead and expenses)? 
• Where do you predict expenses or income will change over the next few years? 

You want to make your business plan financial projections look truly professional. So, break them down into these categories: 

• Sales forecast – total sales expected over the next several years 
• Expenses budget – all the costs you need to operate 
• Profit and loss (P&L) statement – a 12-month summary of revenue versus expenses 
• Cash flow statement – how cash moves in and out of your business, including monthly payments 
• Projected balance sheet – items that aren’t in your P&L, like interest debt, equity, and other factors that affect the net worth of your business 
• Break-even analysis – what you need to earn (at least) to make your expenses and start turning a profit 

A certified public accountant (CPA) can help you put together this part of your business plan for a reasonable fee. It’s well worth it if it helps you obtain investors or bank funding. 

How You Can Start Writing a Hair Salon Business Plan Right Now  

Ready to get started on your hair salon business plan today? Use these tips right away to make it both convincing to lenders and helpful as an internal roadmap: 

• Write a mission statement. To write a solid executive summary, it’s helpful to first compose a mission statement. This delves into why you want to open your business in the first place. Some people include this in their executive summary. Others keep it private and use it as an inspirational jumping-off point. 
• Include milestones in your financial projections. These are points where you will examine progress and see if you’re on target. Be ready to course correct if you’re not hitting your goals. 
• Compile an appendix. It’s a good idea to include an appendix in your business plan with copies of extra materials. This is an ideal place to include photos of your salon, certifications, licenses, and financial documents. It will keep everything organized for you and make you look more professional to lenders. 
• Enlist help. If you have questions about certain sections of your salon business plan, consider consulting with the appropriate professionals. Paying a one-time fee to an attorney or CPA can save you money and headaches down the line. You could even consider hiring a business manager to deal with office and financial issues. 
• Research your competition. If you’re not sure what services to offer or how you stand out, do some in-person recon. Visit competitor salons and check out influencers on social media. How can you align with service gaps and trends to make the most of your business? 
• Explore salon management software. Salon management software can save you a lot of time and make your job a lot easier. For instance, you can use it to quickly and easily generate reports to keep a pulse on your performance. It’ll also help you with other tasks related to your financial success. The best salon management software can automate appointments, keep track of inventory, and assist with marketing. 

Learn How to Manage a Hair Salon Business with SalonBiz  

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Booth Rent Salon Business Plan Template

Explore Options to Get a Business Plan.

Are you interested in starting your own Booth Rent Salon Business?

Introduction

Global market size, target market, business model, competitive landscape, legal and regulatory requirements, financing options, marketing and sales strategies, operations and logistics, human resources & management.

Salon Business Plan Template [Updated 2024]

Salon Business Plan

If you want to start a salon business, including a hair salon or beauty salon, or expand your current salon, you need a business plan.

The following salon business plan template gives you the key elements to include in a winning business plan. It can be used to create a beauty salon business plan, a hair salon business plan, a salon suite business plan or a plan for any other type of salon.

You can download our Beauty Salon business plan template (including a full, customizable financial model) to your computer here.

Sample Salon Business Plan

The sample business plan template below will help you write a business plan for your own beauty or hair salon business.

I. Executive Summary

Business overview.

[Company Name], located at [insert location here] is a brand-new, upscale hair salon focusing on providing high-quality, full-service hair care to the surrounding community. Our product and service lines fit nicely with the prevailing tastes and preferences of the local area – middle class suburbanites want quality hair care, but don’t want to pay luxury prices for it.

Products and Services

[Company Name]will provide relationship-oriented haircutting services for all ages and both genders. Haircutters will focus on building long-term rapport with their clients and strive to deliver personalized beauty results for each individual.

All manner of special treatments will be available—including perms, extensions, coloring, and styling for special occasions (weddings, proms, etc.)

In addition to providing these services, [Company name] will also be a retailer of exclusive hair care products. Customers will find products at [Company name] that they won’t find in grocery stores.

Customer Focus

[Company Name] will primarily serve the residents within a 5 mile radius of our location. The demographics of these customers are as follows:

• 27,827 residents
• Average income of $74,700
• 58.9% married
• 49.6% in Mgt./Professional occupations
• Median age: 38 years

In addition to this prime adult demographic for an upscale hair salon, there are two large high schools and four middle schools in the area. Students, particularly girls, from these schools will be sure to patronize [Company Name] for special occasions.

Management Team

[Company Name]is led by [Founder’s Name] who has been in the hair care business for 20 years. While [Founder] has never run a hair salon himself, he has been cutting hair since age 15 and spent most of his adult life working as a stylist at several major salons.As such [Founder] has an in-depth knowledge of the salon business including the operations side (e.g., running day-to-day operations) and the business management side (e.g., staffing, marketing, etc.).

Success Factors

[Company Name] is uniquely qualified to succeed due to the following reasons:

• The Company will fill a specific market niche in the growing community we are entering. In addition, we have surveyed the local population and received extremely positive feedback saying that they explicitly want to frequent our business when launched.
• Our location is in a high-volume area with easy access from multiple residential and commercial district zones.
• The management team has a track record of success in the salon business.
• The upscale salon business is a proven business and has succeeded in communities throughout the United States.
• Local competitors leave a large gap in the haircut market—there are low-cost providers ($10-$20), and an ultra-luxury salon ($120+), but nothing in between.

Financial Highlights

[Company Name] is currently seeking $260,000 to launch.Specifically, these funds will be used as follows:

• Store design/build: $140,000
• Working capital: $120,000 to pay for Marketing, salaries, and lease costs until [Company Name] reaches break-even

Topline projections over the next five years are as follows:

II. Company Overview

You can download our Salon business plan template (including a full, customizable financial model) to your computer here.

Who is [Company Name]?

[Company Name], located at [insert location here] is a new, upscale hair salon focusing on providing professional hair cut styles and services in an enjoyable environment. It will showcase a well-designed interior as well as a full-featured waiting area equipped with television screens and at-request refreshments. [The Company] also sells a variety of premium hair styling and hair care products which will be on display in the waiting room.

[Company Name] was founded by [Founder’s Name]. While [Founder’s Name] has been in the hair styling business for some time, it was in [month, year] that he decided to launch [Company Name]. Specifically, during this time, [Founder] took a trip to Fort Lauderdale, FL. During his trip, [Founder’s Name] frequented a hair salon that enjoyed tremendous success. After discussing the business at length with the owner of the salon, [Founder’s Name] clearly understood that a similar business would enjoy significant success in his hometown.

Specifically, the customer demographics and competitive situations in the Fort Lauderdale location and in his hometown were so similar that he knew the business would work. After surveying the local population, [Founder’s name] went ahead and founded [company name].

[Company Name]’s History

Upon returning from Fort Lauderdale, surveying the local customer base, and finding a potential retail location, [Founder’s Name] incorporated [Company Name] as an S-Corporation on [date of incorporation].

The business is currently being run out of [Founder’s Name] home office, but once the lease on [Company Name]’s retail location is finalized, all operations will be run from there.

Since incorporation, the Company has achieved the following milestones:

• Found office space and signed Letter of Intent to lease it
• Developed the company’s name, logo and website located at [website]
• Hired an interior designer for the decor and furniture layout
• Determined equipment and fixture requirements
• Begun recruiting key employees with previous hair styling experience

[Company Name]’s Products & Services

Below are [Company Name]’sinitial service offerings and in-store products sold.

Hairstylists will be asked to perform the following services for both men and women:

• Hair washes
• Special event hair styling (such as for a wedding, prom etc.)
• Hair coloring
• Hair extensions

Each appointment will include an initial hair assessment and suggestion phase where the stylist will discuss the customer’s hair and preferred hair style. There will then be a pre-cut hair wash with our in-store products, a haircut or coloring as appropriate, and finally a post-cut styling to our customer’s preferences.

[Company Name] will feature premium hair products in-store from these well established brands. It will continue to update its offering in order to provide the newest hair products to its customers.

Some of its featured brands will include:

• Schwarzkopf
• Sexy hair concepts
• Paul Mitchell Systems

Furthermore, the waiting area will have television screens and popular publications to make the wait for service more pleasurable. Toys and board games will also be on hand for children, as well as at-request refreshments which we will provide for free during the waiting period.

Salon Design

[Company Name] will develop a 2,500 square foot store whose key elements will include the following:

• Stylist Booths
• Reception Desk
• Self-service coffee area
• Sinks to wash hair
• A waiting area with TV screens

Below please find a rough sketch of the floor plan:

The retail location has 10 dedicated parking spots which should suffice even in peak hours.

[Company Name] plans to be open 6 days a week, from 10AM to 6PM. As demand dictates, we may extend or reduce our hours.

III. Industry Analysis

[Company Name] competes against small, individually owned hair salons and barber shops, and against major regional or national chains. There are over 450,000 registered salons in the United States, a figure that reflects the hair cutting needs of 300 million people.

The hair salon industry is a fragmented one, as the 50 largest companies only hold 15% of the market, which is estimated to grow to more than $35 billion in three years. This bodes well for [Company Name]; since there are no truly dominant competitors, barriers to entry are not as high as many other industries, and a start-up can expect to have success in this growing market. There is plenty of room in the industry particularly for well-placed local salons that cater to specific geographic and demographic customer niches. Smaller hair salons can easily develop loyal clienteles that enable them to compete and succeed against industry giants; in this industry, size does not necessarily mean an advantage, which bodes well for [Company name].

The largest competitor in the hair salon industry is Regis Corporation, which is affiliated with more than 8,000 locations across the continent. Their business model uses a combination of franchising and corporate ownership, along with several different brand names at different market positions. Regis tends to maintain central control of its higher-end locations, and franchise its discount haircutters.

Industry Trends

The industry in which [Company Name] will compete is experiencing a number of different trends.

Market-level trends:

• Slow but steady growth. This market is expected to grow consistently at around 2% annually.
• Success drivers. Customer satisfaction is what ultimately makes one salon triumph while another fails. The experience a salon’s client has determines whether or not they return and whether or not they refer others to the same salon.
• Seasonal change. The hair salon industry tends to thrive in the spring and fall, but slow down during the winter and summer. [Company Name] will launch haircutting operations during [Fall/spring], when the industry is experiencing higher sales. Catching a seasonal upswing in the first quarter of business should help provide a buffer of cash for [Company name].

Firm-level trends:

• Price sensitivity at the bottom. The low-cost segment of the market, which primarily serves men and children, often competes on the basis of price. This reflects the different preferences of these particular consumers, who are often more interested in an affordable haircut than in seeing the same hair cutter on a regular basis.
• Size at the bottom. Larger hair salon chains tend to gravitate toward the bottom of the market. Brand loyalty is not strong here. Many companies in this segment use a franchise model.
• Economies of scale. Larger salons are finding opportunities to succeed, by making effective use of support personnel. Receptionists, hair washers, and assistants at larger establishments can take care of many of the menial tasks that skilled haircutters have to handle in small salons. This permits a skilled hair cutter to spend a higher proportion of their time actually cutting hair and generating revenues.
• Premium independent salons. Independent salons also compete in the premium segment of the market. These firms develop loyal customer bases and select their location on the basis of population demographics.
• Specialty salons. Presently, a niche is being carved out for salons that cater to very specific customer segments, most notably adult males from higher income brackets. High-end, men-only hair clubs draw this crowd with upscale amenities such as cigars, pool tables, and drink bars.

Customer-level trends:

• Intense customer loyalty. Many salons develop repeat customers who become a regular client base and represent a significant portion of their revenues. Salons whose employees are able to develop strong relationships with customers can expect to see more long-term success.
• Changing gender patterns. Traditionally, women bring in the lion’s share of revenues for hair salons, using beauty services more often and spending more at each appointment. In recent years, however, the male consumer’s attitude has begun to shift. Men now make up approximately 25% of salon clientele.
• Gender preferences. Women are the most lucrative customers for hair salons, visiting more often and purchasing more special treatments such as coloring.
• Ideal demographics. The baby boom generation generates a very large portion of hair salon revenues. This large segment of the market has reached the peak of its earning power, and they are beginning to need special treatments such as coloring.

IV. Customer Analysis

Demographic profile of target market.

[Company Name] will serve the residents of [company location] and the immediately surrounding areas as well as those who work in [company location].

The area we serve is populated mostly by the middle class; as a result, they have the means to pay for higher quality service, and are looking for a hair and beauty services somewhere between the deep discounters and the top-end luxury brands.

The precise demographics of the town in which our retail location resides is as follows:

Customer Segmentation

The Company will primarily target the following three customer segments:

• Soccer/stay-at-home moms: The town has a large population of stay-at-home moms who are active in the school and community. These moms seek beauty services on a regular basis. Winning the loyalty of a mother often includes winning the business of her children and husband as well. These women are well connected to each other and as such are a prime source of referral business. [Company name] expects to regularly acquire new customers from referrals.
• Professionals: [Company name] is located along a well-traveled commute route. By offering convenient location and exceptional service to the customer, [Company name] will draw in working men and women who need to look professional for work.
• Students: There are multiple high schools and middle schools located in the surrounding area. These students still live on their parents’ income and can therefore afford to pay for higher-quality services than discounters provide. In particular, [Company name] can expect to generate significant seasonal business based on the beauty needs of the local youth culture.

V.Competitive Analysis

Direct & indirect competitors.

The following retailers are located within a 5 mile radius of [Company Name], thus providing either direct or indirect competition for customers:

Joe’s Beauty Salon

Joe’s Beauty Salon is the town’s most popular beauty salon and has been in business for 32 years. Joe’s offers a wide array of services that you would expect from a beauty salon.

Besides offering hair cuts, Joe’s also offers nail services such as manicures and pedicures. In fact, over 60% of Joe’s revenue comes from services targeted at women outside of hair services. In addition, Joe’s does not offer its customers premium salon products.

For example, they only offer 2 types of regular hair gels and 4 types of shampoos. This puts Joe’s in direct competition with the local pharmacy and grocery stores that also carry these mainstream products. [Company Name], on the other hand, offers numerous options for exclusive products that are not yet available in [Town’s Name].

LUX CUTS has been in business for 5 years. LUX CUTSoffers an extremely high-end hair service, with introductory prices of $120 per hair cut.

However, LUX CUTS will primarily be targeting a different customer segment from [Company Name], focusing on the households with an income in the top 10% of the city.

Furthermore, [Company Name] offers many of the services and products that LUX CUTS offers, but at a fraction of the price, such as:

• Hair style suggestions & hair care consultation
• Hair extensions & coloring
• Premium hair products from industry leaders

Freddie’s Fast Hair Salon

Freddie’s Fast Hair Salonis located four stores down the road from [Company Name]. Freddy’s has been in business for the past 3 years and enjoys great success, primarily due to its prime location.

Freddy’s business offers inexpensive hair cuts and focuses on volume over quality. It also has a large customer base comprised of children between the ages of 5 to 13.

[Company Name] has several advantages over Freddy’s Fast Hair Salon including:

• An entertainment focused waiting room, with TV’s and board games to make the wait for service more pleasurable. Especially great for parents that bring their children.
• A focus on service quality rather than speed alone to ensure repeat visits. [Company Name] will spend on average 20 more minutes with its clients than Freddy’s.

While we expect that Freddy’s Fast Hair Salon will continue to thrive based on its location and customer relationships, we expect that more and more customers will frequent [Company Name] based on the high-quality service it provides.

Competitive Pricing

Competitive advantage.

[Company Name] enjoys several advantages over its competitors. These advantages include:

• Location: [Company Name]’s location is near the center of town, giving us access to commuters going to and leaving the train station, local office workers, and passersby shopping in the city. We also offer adequate parking making it easy for customers to patronize us.
• Great service at an affordable price: The complete array of hair services offered by [Company Name] nearly equals the most premium positioned competitor, LUX CUTS. However, [Company Name] will offer these services at a much more affordable price.
• Management: Our management team has years of business and marketing experience that allows us to market to and serve customers in a much more sophisticated manner than our competitors.
• Relationships: Having lived in the community for 25 years, [Founder’s Name] knows all of the local leaders, newspapers and other influences. As such, it will be relatively easy for [Company Name] to build brand awareness and an initial customer base.

VI.Marketing Plan

[Company name] seeks to position itself as a respectable, upper-middle-market competitor in the hair salon market. Customers can expect to receive professional hair care from familiar haircutters for a price somewhere between discount chains and luxury establishments.

The [Company Name] Brand

The [Company Name] brand will focus on the Company’s unique value proposition:

• Convenient location
• Familiar, regular hairstylist
• Significant personal attention
• Moderate price point
• Comfortable, customer-focused environment

Promotions Strategy

[Company Name] expects its target market to be individuals working and/or living within a 5-mile radius of its location. [The Company’s] promotions strategy to reach these individuals includes:

Local Publications

[Company name] will announce its opening several weeks in advance through publicity pieces in multiple local newspapers and publications. Regular advertisements will run to maintain exposure to relevant markets. Community newspapers, school publications, youth sports programs, and similar channels will be a major promotion effort.

Major Publications

We will make careful use of advertising in selected larger publications. [Publication or newspaper name] has a circulation of xyz and we can expect to reach a wider geographic region of customers on a limited basis. Advertisements with major publications will be used selectively, based on cost effectiveness. These ads will include discount coupons so that response to the ads can be tracked.

Community Events/Organizations

[Company name] will promote itself by distributing marketing materials and participating in local community events, such as school fairs, local festivals, homeowner associations, or sporting events. Since mothers are often heavily involved in such things, we will not only reach the lucrative audience of adult women but also potentially their families by extension.

Commute Advertising

We will drive attention toward [Company name] by hiring workers to hold signs alongside [route or highway]. Advertising on heavily traveled commute routes are an opportunity to alert large numbers of working individuals with disposable income of our opening.

Customer Loyalty Programs

[Company name] will create a winning customer loyalty program to keep its best clients coming back again and again. When not actively providing services to customers in the store, our professionals and other employees will make periodic, regular phone calls to customers. These phone calls will (a) ensure that customers are satisfied with their hair treatment, and (b) remind customers after a certain period of time has passed that they might want a new haircut. Long-term customers will have the opportunity to participate in the loyalty program, and referrals will be rewarded as well.

Direct Mail

[Company Name] will blanket neighborhoods surrounding its locations with direct mail pieces. These pieces will provide general information on [Company Name], offer discounts and/or provide other inducements for people to visit the salon.

Ongoing Customer Communications

[Company Name] will maintain a website and publish a monthly email newsletter to tell customers about new events, products and more.

Pre-Opening Events

Before opening the store, [Company Name] will organize pre-opening events designed for prospective customers, local merchants and press contacts. These events will create buzz and awareness for [Company Name] in the area.

Pricing Strategy

[Company Name]’s pricing will be moderate so customers feel they receive great value when patronizing the salon. The anticipated price point for a standard hair treatment is $35, in exchange for which a customer can expect to receive personalized attention during and after their visit. The customer can expect to receive quality hair care from a familiar haircutter, for a more affordable price than what they pay at an ultra-premium salon.

VII.Operations Plan

Functional roles.

[Company name] will carry out its day-to-day operations primarily on an appointment basis. Walk-in clients will be served by the earliest available hairstylist, but priority will be given to clients who called ahead. In the meantime, waiting customers can divert themselves in the lounge, which features television and current popular magazines. The Company intends to employ [X] hairstylists and [A] assistants during peak hours and [Y] hairstylists and [B] assistants during off-peak hours. [Company name] anticipates having [Z] customers on a weekly basis.

In order to execute on [Company Name]’s business model, the Company needs to perform several functions. As a hair salon, the majority of employees will assist in up selling customers in addition to the primary functions as hair cutters and specialists (coloring, perms, etc). [Company name] anticipates using the services of X employees, divided into the following roles.

Service Functions

• Hair cutting
• Hair washing
• Product sales

Administrative Functions

• General & administrative functions including legal, marketing, bookkeeping, etc.
• Sourcing and storing products
• Hiring and training staff
• Appointment making
• Customer service/cash register functions

Miscellaneous

• Maintenance personnel

[Company name]’s long term goal is to become the dominant provider of hair care and related services and products in the [city] area. We seek to the standard by which other providers are judged.

The following are a series of steps that lead to our vision of long-term success. [Company Name] expects to achieve the following milestones in the following [xyz] months:

VIII. Management Team

Management team members.

[Company Name]is led by [Founder’s Name] who has been in the hair salon business for 20 years.

While [Founder] has never run a hair salon himself, he has extensive experience cutting, treating, and styling hair at major salons for the past 20 years. He began his career in [19xx] when he received a certification from [Hair Cutting School] and began work at [major chain], where he worked for X years.

[Founder] graduated from the University of ABC where he majored in Communications.

[Other person’s name] will serve as the customer service manager. He/she has extensive experience the hospitality industry.

Hiring Plan

[Founder] will serve as the store manager. In order to launch our salon, we need to hire the following personnel:

• Hair Stylists [Number]

As dictated by demand and operational maturity, [Founder] will consider hiring the following personnel:

• Hair Treatment Specialist [Number]
• Receptionist [Number]
• Store Manager

IX. Financial Plan

Revenue and cost drivers.

[Company Name]’s revenues will come primarily from the services rendered and secondarily from the sale of hair care products.

As with most services, labor expenses are the key cost drivers for hair salons. Hair stylists are paid through a combination of salaries and commission, rewarding them for performance and making hair stylists an active part in business retention and development.

The major cost drivers for the company’s operation will consist of:

• Commission paid to hair stylists on a per service basis

Moreover, ongoing marketing expenditures and cost of good sold expenses are also notable cost drivers for [Company Name].

Capital Requirements and Use of Funds

[Company Name] is seeking total funding of $260,000 of debt capital to launch its store. The capital will be used for funding capital expenditures and location build-out, hiring initial employees, marketing expenses and working capital.

Specifically, these funds will be used as follows:

• Working capital: $120,000 to pay for marketing, salaries, and lease costs until [Company Name] is cash-flow positive

Key Assumptions & Forecasts

The following table reflects the key revenue and cost assumptions made in the financial model.

5 Year Annual Balance Sheet

5 Year Annual Cash Flow Statement

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3 Salon booth rental agreement templates and examples (PDF)

How do you create a booth renter contract? Explore templates, examples, and insights for booth rental agreements.

Content Marketing Manager

Preparing a booth rental agreement is the first step in transitioning to a suite rental or hybrid model.

As a software built for salons (including those with booth renters), Mangomint gathered templates and insights to help. Still, it is essential to seek personalized legal counsel before moving forward. The booth rental laws vary from state to state, and your salon's unique setup can affect the needs of your agreement.

If you are looking for a salon software system that supports booth rental, hybrid, and standard models, Mangomint can help!

Try Mangomint for free

See Mangomint in action  instantly with pre-populated sample data. No credit card required. Free for 30 days.

1) Booth rental agreement for salons in California

California is home to one of the most abundant salon scenes. With its complex legal system, these booth renter agreements can be especially tricky.

This example booth rental agreement is tailored to California laws and details a monthly rent structure. It also demonstrates how you can use a signing bonus to incentivize new booth renters.

Download our California booth rental agreement

2) Booth rental agreement for salons in Texas

Booth rental agreements have to balance flexibility for renters and protection for businesses. For example, this Texas booth rental agreement allows for sublets — but only when approved by the salon owner. It also enforces a missed rent penalty but offers a short grace period for late payments.

Download our Texas booth rental agreement

3) Booth rental agreement for salons in Florida

Florida salons know that the structure of business operations can vary starkly between businesses. With seasonal tourism affecting demand in certain parts of the state, you can protect your revenue stream by enforcing longer contract terms in your booth rental agreements. As such, this template takes on a year-long lease term with monthly payments.

Download our Florida booth rental agreement

View our booth rental webinar

Check out our webinar about managing booth renters in Mangomint's salon software.

A guide to booth rental considerations

For many salon owners, booth rental is the key to boosting profits while alleviating extra salon management work. These rentals can provide additional revenue, support a low-maintenance management style, and encourage diversified salon services. However, these benefits also include extra considerations, especially when getting started.

Personalization is critical when creating your ideal booth rental agreements. If you're using a template, ensure you tailor the details to your business before sending it to legal for review. Or, if you're having a legal team create your agreement from scratch, give them a list of your insights and requests, such as:

Pricing: How much will you charge for each booth rental, and how will you determine payment for items like utilities?

Payment configurations: How frequently is your rent charged, and when will your booth rent be due within this period? For example, monthly payments are the most common option, and you must determine whether booth renters pay at the beginning, middle, or end of each month.

Booth description: What space is the booth renter paying for? You should include details like the square footage of their booth space, information about parking, what furnishings + equipment are included, and which services your salon is permitted for.

Lease term: How long is the agreement term? Will you allow salon owners to sublet their booth if they need to leave sooner?

Penalties: How much will you charge for a broken lease or a late payment? Will you offer a grace period before the penalty?

Limitations in booth rental agreements

While it might be easy to think about booth renters like other members of your team, they legally act as an independent business operating inside your building.

As such, many states will limit your control over booth rentals. For example, you can offer them access to your software to streamline booking and payout information. However, it may be illegal in your state to force them to use a particular tool or system.

When creating your agreement and talking with potential renters, it is essential you explain any possible repercussions of using a different software system . For example, let's say you are a hybrid salon with one color processor. You may utilize your salon software's resource scheduling feature to avoid overlaps between hair processing appointment times. So, if a booth renter chooses a different software system, it may disrupt their access to shared salon resources.

However, it is ultimately up to your booth renters to decide which software system to use.

Similarly, you can request reasonable social accommodations — like maintaining a peaceful environment. Still, it might be illegal to demand they sign a "culture contract" or make them adhere to certain preferences that your salon favors.

If you want this level of control over your business, the booth renter or hybrid model might not be for you.

Even if these practices are optional in your state, you may have difficulty keeping independent booth renters engaged if you do not meet the industry's standards.

Additional insights for booth rentals

In a traditional salon, all your processes can be managed using comprehensive salon software. When transitioning to a booth rental or hybrid model , you will need some extra considerations within your management system, such as:

How you'll collect and distribute payments: Payment accounts can be tricky when dealing with booth rental spaces. You can read our guide to setting up your independent merchant accounts here .

Direct booking links: If your booth renters choose to use your software, you can help keep things streamlined with direct booking and scheduling links .

How you'll manage inventory and commission: If you want booth renters to help move your salon's inventory, it is vital you find a compensation model (likely commission-based) that booth renters will be excited about.

Communication and settings: You should partner with a software system that lets you set unique permission configurations for booth renters . This setting will give them access to necessary data without compromising your business's proprietary information.

Learn about flexible payment options

Mangomint's payment options are tailored to support every business type, from traditional salons and spas to booth rental & hybrid models.

As you get settled in, the booth rental model can require some getting used to. Don't be discouraged if things aren't seamless from the start. While easing into the booth rental model, prepare to problem-solve and find what works best for everyone involved.

It may take some adjusting, but if it is a good fit for your salon, you will soon start to see the benefits of booth rentals take shape.

Moving forward with booth rentals

Mangomint can help your salon or spa thrive — in traditional, booth rental, and hybrid models alike. Book a demo to learn how our adaptable software can support your business, or start a free trial to experience the platform first-hand today.

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To april 25th, 2024, dental salon moscow apr. 2024, event information.

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