Business Overview

Beauty salons have become increasingly popular as disposable income has risen. Salons are as much a social institution as they are a way to improve the appearance of customers. The beauty industry generated $62.46 billion in 2016 alone, and it’s numbers have consistently gone up for the past 13 years.

Who is this business right for?

This business is right for those who care about making others feel better about themselves by way of improving their appearance. Owners do not need to be licensed in cosmetology if they do not planning to administer any services, but it is strongly recommended to have cosmetology training so you are knowledgeable about the services your business offers. Ideally, the owner will be a very sociable person, as you will need to build relationships with clients in order to create returning customers.

What happens during a typical day at a beauty salon?

To a certain extent, owners can decide how much they want to be involved in the business. An owner may hire managers to ensure the salon is running smoothly, while they concentrate more on investing in the new ventures and trends. However, here are some of the usual duties of beauty salon owners:

  • Finding a space with a good deal of foot traffic
  • Advertising the salon (web, print, television, etc.)
  • Ensuring inventory is stocked
  • Analyzing current and future customer demand
  • Performing styling duties
  • Managing employee schedules
  • Ensuring cleaning procedures are followed

What is the target market?

Beauty salons will profit most from repeat clientele. You’re looking for men and women who are willing to pay more for quality work, and those who need set services every month.

How does a beauty salon make money?

Beauty salons make money by exchanging beautifying services for money. It is important to find\ the right profit margins for your services. Some salons use a base rate for coloring or haircuts. A good rule of thumb is to look at the pricing structure of other salons in the area, and aim for a middle-of-the-road approach. Customers do have their budget limits, but they may become instantly suspicious about the quality of work if the rates are too low.

What is the growth potential for a beauty salon?

Depending on the space you get, the potential can be unlimited. Along with common menu items like waxing, manicures, and pedicures, consider either offering or leaving the door open for spa features like steam baths, or skin treatments like Botox.

A beauty salon’s growth is rooted in being able to keep up with the market. Your ideal customer may want standard and familiar (e.g., a manicure) or something a little more risqué (e.g., vampire facelifts.)

Once your business has a steady flow of business, it is possible to open a second or even third location to maximize the reach of your business.