Start a nail salon by following these 9 steps:
You have found the perfect business idea, and now you are ready to take the next step. There is more to starting a business than just registering it with the state. We have put together this simple step guide to starting your nail salon. These steps will ensure that your new business is well planned out, registered properly and legally compliant.
STEP 1: Plan your Business
A clear plan is essential for success as an entrepreneur. It will help you map out the specifics of your business and discover some unknowns. A few important topics to consider are:
- What are the startup and ongoing costs?
- Who is your target market?
- How long it will take you to break even?
- What will you name your business?
Luckily we have done a lot of this research for you.
What are the costs involved in opening a nail salon?
Most nail salons are at least 1,000 square feet, and building out a salon typically costs between $75 and $125 per square foot. This comes to a total build-out cost of $75,000 to $125,000 for a 1,000-square-foot salon.
Business owners who are looking to reduce the startup costs for a nail salon may be able to purchase used equipment from a previous salon owner, or even lease space that has previously housed a salon. Finding a location where a salon closed will greatly reduce buildout costs.
Alternatively, business owners might be able to find a location where a property owner will build to suit. In build-to-suit agreements, property owners usually build a facility to the tenant’s specifications, and the tenants agree to a lease.
What are the ongoing expenses for a nail salon?
The ongoing expenses for a nail salon business include supply costs, employee’s wages (whether salaries or commissions), taxes, rent, maintenance on equipment and insurance. Supply costs are usually between 2 and 8 percent of sales.
Who is the target market?
A nail salon business’ ideal customer is someone who cares about their appearance, appreciates fashion and has some discretionary income. Such a person is likely able and willing to spend money to make their nails look good. Most salons’ customers are primarily women, but salons also serve men.
How does a nail salon make money?
A nail salon makes money by charging customers for manicures, pedicures and similar treatments. Some also sell premium nail care products.
How much can you charge customers?
Nail salon businesses offer a number of different nail services. Manicures typically range between $15 and $25, and pedicures are usually between $25 and $45. Other major treatments include:
- Full gel sets ($45 to $75)
- Full acrylic sets ($30 to $60)
- Silk nails ($10 to $15)
Fillers, polishes and repairs are needed between full sets. These kinds of services range from $3 (for some repairs) to $30 (for gel polishes).
How much profit can a nail salon make?
A single nail salon business might bring the owner between $40,000 and $75,000 each year. The business model is easily scalable, though. Some nail salon owners have lots of locations and are millionaires.
How can you make your business more profitable?
A nail salon business can increase its revenue by upselling customers with additional services and selling premium nail care products. Since salons already use high-end products, it’s easy to sell these to customers who want to take better care of their nails at home.
What will you name your business?
Choosing the right name is very important. We recommend checking if the business name you choose is available as a web domain and securing it early so no one else can take it.
After registering a domain name, consider setting up a professional email account (@yourcompany.com). Google's G Suite offers a business email service that comes with other useful tools, including word processing, spreadsheets, and more. Try it for free
STEP 2: Form a legal entity
Establishing a legal business entity such as an LLC prevents you from being personally liable if your nail salon is sued. There are many business structures to choose from including: Corporations, LLC's, and DBA's.
You should also consider using a registered agent service to help protect your privacy and stay compliant.
For most small businesses forming an LLC is a great option, but if you still want to weigh all your options check our our article, What Structure Should I Choose for My Business?
STEP 3: Register for taxes
You will need to register for a variety of state and federal taxes before you can open for business.
In order to register for taxes you will need to apply for an EIN. It's really easy and free!
You can acquire your EIN for free through the IRS website, via fax, or by mail. If you would like to learn more about EINs and how they can benefit your LLC, read our article, What is an EIN?.
STEP 4: Open a business bank account & credit card
Using dedicated business banking and credit accounts is essential for personal asset protection.
When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your business is sued. In business law, this is referred to as piercing your corporate veil.
Open a business bank account
- This separates your personal assets from your company's assets, which is necessary for personal asset protection.
- It also makes accounting and tax filing easier.
Get a business credit card
- This helps you separate personal and business expenses by putting your business' expenses all in one place.
- It also builds your company's credit history, which can be useful to raise money and investment later on.
STEP 5: Set up business accounting
Recording your various expenses and sources of income is critical to understanding the financial performance of your business. Keeping accurate and detailed accounts also greatly simplifies your annual tax filing.
STEP 6: Obtain necessary permits and licenses
Failure to acquire necessary permits and licenses can result in hefty fines, or even cause your business to be shut down.
State & Local Business Licensing Requirements
Certain state permits and licenses may be needed to operate a nail salon. Learn more about licensing requirements in your state by visiting SBA’s reference to state licenses and permits.
In particular, most states require retail businesses to obtain a seller’s permit. A seller’s permit allows states to record and collect taxes from goods (and sometimes service) sales.
Most businesses are required to collect sales tax on the goods or services they provide. To learn more about how sales tax will affect your business, read our article, Sales Tax for Small Businesses.
In addition, certain local licensing or regulatory requirements may apply. For more information about local licenses and permits:
- Check with your town, city or county clerk’s office
- Get assistance from one of the local associations listed in US Small Business Associations directory of local business resources
Nail salons are regularly inspected by local health departments. Standards that must be met during inspections vary accordingly. Here is an article about one salon owner’s inspection experience.
In order to play music in a business setting, permission must be acquired from the composer or license holder. Typically, it is possible to obtain a “blanket” license allowing a businesses to play music owned by a large catalog of artists and recording studios. Such licenses can be obtained from Performance Rights Organizations, such as ASCAP or BMI.
Certificate of Occupancy
A nail salon is generally run out of a small retail location. Businesses operating out of a physical location typically require a Certificate of Occupancy (CO). A CO confirms that all building codes, zoning laws and government regulations have been met.
- If you plan to lease a retail location:
- It is generally the landlord’s responsibility to obtain a CO.
- Before leasing, confirm that your landlord has or can obtain a valid CO that is applicable to a nail salon.
- After a major renovation, a new CO often needs to be issued. If your place of business will be renovated before opening, it is recommended to include language in your lease agreement stating that lease payments will not commence until a valid CO is issued.
- If you plan to purchase or build a nail salon:
- You will be responsible for obtaining a valid CO from a local government authority.
- Review all building codes and zoning requirements for your business’ location to ensure your nail salon business will be in compliance and able to obtain a CO.
STEP 7: Get Business Insurance
Insurance is highly recommended for all business owners. If you hire employees, workers compensation insurance may be a legal requirement in your state.
STEP 8: Define your brand
Your brand is what your company stands for, as well as how your business is perceived by the public. A strong brand will help your business stand out from competitors.
How to promote & market a nail salon
Because nail salons primarily serve a local area, marketing efforts should focus on reaching residents and workers in the nearby community. Discounted services are one way to get customers in the door initially, but this strategy may only attract one-time customers who are looking for a bargain.
Another way to get customers in is by partnering with another local business, such as a DJ or new caterer, to host a little party. Customers may be willing to pay for a treatment during a special event that includes music and light refreshments.
One of the best ways to consistently grow a nail salon’s business is through word-of-mouth advertising. For this reason, it’s important to provide excellent service so that people will mention your salon to friends and family. Encouraging customers to leave online reviews can also help draw people to the salon.
Recommended: Get started with local advertising for your business with a $300 credit from Yelp.
How to keep customers coming back
Nail salons can develop loyal customers by consistently providing excellent service and following proper hygiene protocols. Offering loyalty cards that give customers a free treatment after a certain number of services is a way to keep customers coming back more frequently.
STEP 9: Establish your Web Presence
A business website allows customers to learn more about your company and the products or services you offer. You can also use social media to attract new clients or customers.
Start A Nail Salon In Your State
Select your state below for an in-depth guide on completing each of these steps in your home state.
Is this Business Right For You?
The ideal nail salon owner is someone who appreciates fashion and beauty. In addition, a nail salon owner must be personable and friendly, as providing customers with a comfortable, pleasant atmosphere assures that they will return in the future and increases the chance that they will recommend your salon to those in their social sphere. It is very helpful for business owners to either possess prior business knowledge/experience or the willingness to educate themselves about business practices.
What happens during a typical day at a nail salon?
A nail salon business owner may spend a portion of their time providing services for customers, which involves:
- Scheduling appointments for customers
- Giving customers manicures, pedicures and other treatments
- Restocking supplies as they’re used
- Cleaning equipment between customers
Most salons, however, employ nail technicians who also perform these tasks. Having technicians gives business owners time to focus on other tasks, such as:
- Forecasting sales and scheduling technicians as appropriate
- Recruiting and training new technicians as needed
- Managing all technicians employed by the salon
- Marketing and growing the business
- Ordering supplies as they’re used
- Overseeing the operations of the nail salon
Even when performing tasks like these, owners still have chances to (and should) connect with customers. Many of these behind-the-scenes activities are still done within the salon, so owners regularly see their salon’s customers. Talking with customers both builds connections with them and helps owners know their salon better.
What are some skills and experiences that will help you build a successful nail salon?
A nail salon business owner should be knowledgeable in nail care and treatments. There are many courses available for nail technicians that cover topics such as infections, infection control, pedicures, manicures and nail art. The New York Institute of Beauty offers one program, but there are schools throughout the country. The Professional Beauty Association also offers courses. How to Start a Nail Salon Business is a useful book for those who don’t want to take a class.
What is the growth potential for a nail salon?
A nail salon business can be as small as a single location, or it can be as large as a national chain. Successful salons sometimes open multiple locations within a single city or geographic region.
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Take the Next Step
Find a business mentor
One of the greatest resources an entrepreneur can have is quality mentorship. As you start planning your business, connect with a free business resource near you to get the help you need.
Having a support network in place to turn to during tough times is a major factor of success for new business owners.
Resources to Help Women in Business
There are many resources out there specifically for women entrepreneurs. We’ve gathered necessary and useful information to help you succeed both professionally and personally:
If you’re a woman looking for some guidance in entrepreneurship, check out this great new series Women in Business created by the women of our partner Startup Savant.
How and when to build a team
Most nail salons have several nail technicians on staff when they open. Multiple technicians are needed so salons can be open every day (or almost every day) and throughout most of the day. Technicians typically make between $22,000 and $43,000 annually, with their compensation being largely commission based. Technicians often make between 35 and 60 percent of the value of the treatments they perform.
As a salon grows, it may become expedient to hire the following additional staff:
- Receptionist(s) (with a salary of $17,000 to $29,000 annually)
- Salon manager (with a salary of $21,000 to $47,000 annually)
- Aesthetician (with a salary of $23,000 to $56,000 annually)
- Manicurist (with a salary of $20,000 to $50,000 annually)