Opening a salon is exciting, but there's also a lot of work.
Surprisingly, half of new salons encounter difficulties within their first three years due to a lack of proper planning and operational knowledge.
From establishing booking systems and cancellation policies to managing finances and staff, opening and running a successful salon can be overwhelming. But don't worry, in this article we'll guide through the process of creating a business plan that will set your salon up for success.
A salon business plan is a written document that covers all the details about your business such as the vision, the mission, marketing analysis, financial projections, and more.
It’s like a roadmap of your business that includes sections about your business goals and how you’re going to reach them.
So, the salon business plan can remind you what you wanted to achieve in the first place and where you are heading.
But this doesn’t mean that once written, it cannot be modified.
Your business plan should be kept up to date with all company changes, such as new business goals, new marketing strategies, and so on.
There are successful businesses that can start and succeed without a business plan, but having these plans can help keep your head in the game and make better decisions. Most importantly, they can help you determine your revenue and labor costs.
When opening a hair salon there are a lot of things to take into consideration, such as equipment needs, administrative staff, and stylists.
So having a business plan can help you forecast your spendings and have an idea of what your profit will be. It can also help you reach your short and long-term goals because you can always take a look in your business plan and see what and how you want to achieve. As you grow your business, you can continue to look at your plan and make sure you are on track.
Business plans can also help you get fundings or help you take out a loan. Banks and investors often want to see a business plan before they provide you with funding. That’s because having a business plan shows that you’ve done your research, know what you want from your business, and you’re less likely to be a risk.
So, let’s see what you need to write in your business plan.
We’ve broken down the entire process of writing the perfect business plan for your salon in 8 simple steps.
In the executive summary you should give a basic understanding of what your salon offers because it’s, well, a summary.
So keep the more in depth analysis in the individual sections of your business plan.
Some of the key elements you should include in the summary are:
💡Pro tip: This is the most important section of your plan if you want to get investors or bank fundings because it should persuade them to read the whole business plan. That’s why it would be best to complete it last. You’ll have all the information already written in your plan so it will be much easier to write it.
This business plan section is about who you are and what you plan to do. You can dive into your background and talk about the circumstances that led you wanting to start your salon business in the first place. Then, you can continue to write about why you want to start a hair salon business and what makes your business special.
Some other key components you can mention in this section are:
Writing about your vision, mission, and business objective will define how your business will work because it explains why it exists and what will be the impact on your business once you achieve your goals.
💡Pro tip: You can use ChatGPT to help you write a catchy salon business description.
There are almost a million salons in the US—and that only covers hair salons. While many salons can operate similarly and still thrive, you need to identify what will make your salon stand out, what are its unique strengths, and how it compares to others.
So, in this section you should:
This whole marketing analysis section will influence everything from your pricing strategy, your service offering, or even your location.
💡Pro tip: Once you understand the needs of your target clients, you can pinpoint the reasons they might choose your salon over competitors. As you write your salon’s business plan, position your business with these insights from your market research, so that your salon can rise above a crowded market.
Showcase your value by detailing your services and pricing. This will demonstrate how your salon will generate revenue.
This is where you’ll talk about the operational side of your business. Some things to think about around salon management and operations might include:
Include your technology needs, such as client booking software, salon insurance types, and payment processing tools. Look for a booking software that:
Based on the marketing analysis you previously created where you talked about your competitors, your advantages, and you target customers’ preferences, you should create your salon marketing plan.
Your marketing plan should outline the strategies you will use to attract and retain customers.
These strategies might include:
Calculating your finances isn’t the most glamorous part of owning a hair salon, but it’s one of the most important parts.
When writing your business plan, you first need to know how much it costs to open a hair salon and then, write down all financial projections.
Essentially, this involves estimating how much money you expect to spend and make over the next few years.
The best way to get started with your financial projections is to create an income statement which will break down into income sources and their associated costs.
Here are some areas to cover in your hair salon financial plan:
Once you’ve created your hair salon business plan, it’s time to get to the actual work and use your capital (loans or personal investments) to find the best location for your salon that matches your marketing analysis requirements.
Before getting ready to renovate the new location, research and obtain necessary licenses and permits to legally operate a salon in your area. This should include business licenses and health department approvals.
After you have all the licenses, it’s time to decorate your future salon according to your brand’s colors – consider aesthetics, furniture, equipment and arrange everything so it will facilitate an efficient workflow for your hair stylists.
Then you should hire and train all your hair dressers and staff members and align everything with your salon’s culture and customer service standards.
Based on the marketing plan you created, create that website and social media accounts you wrote about and start putting your marketing strategies into action.
Set your accounts on a booking app like Goldie that will help you with client managing, marketing, online booking, and online payments to be stress-free when clients will keep on coming. You can download it for free from the App Store or Google Play.
Get ready for the launching day by offering introductory promotions, discounts, or special treatments to turn your customers into loyal ones.
Now, all that’s left to do is to provide exceptional customer experiences, and continue to monitor your business to see if everything is working according to your plan or even better.
It might seem like a business plan is a lot of work to do before you actually get started, but it will actually help smooth things out for you once you finally decide to launch your hair salon.
And having everything mapped out will minimize surprises, as a well-written business plan helps you anticipate some of the potential challenges.
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