Starting a Beauty Salon Business in 2021: A 9 Step Guide to Success

1. Getting Started

Almost endless beauty services exist, from haircuts and waxing, to manicures and massages, plus much more. 

So choosing your niche will be a big decision.  

You don’t have to specialize in everything, in fact, it’s best to start small by focusing on just one or two primary services that you are passionate about (at least during the initial stages). 

In fact, you can even run this business from home with a minimal initial investment as long as you have a customer base that is willing to come to you.

Starting a brick and mortar beauty parlor will be more expensive, since you will need to rent the space, but you will be able to attract more clients with a professional salon space. 

Once you’ve chosen your beauty industry niche and decided on where you will be running your business… 

It’s time to map out your business plan. 

To get started, you’ll need to be knowledgeable about the following areas:

Planning and organization are major keys to success when starting a small business, so don’t neglect these beginning stages. 

It may also be helpful if you have a business partner who is familiar with the cosmetology and beauty industry. 

Opening a beauty parlor requires a lot of planning beforehand, and you should start thinking about a clear plan long before you start taking customers. 

Your business plan is your road map throughout this process. 

It will keep you focused on your goals, and help you to spot potential roadblocks before they come up.  

When writing your business plan, include these basic elements:

2. Finding Your Niche

The next step is to narrow down which services you’ll offer.

Your list of services will determine your niche. 

There are many possibilities here.

But the biggest thing you need to take into consideration is the training and certifications involved with each of these services.  

If you don’t have these skills or certifications yourself, then you will need to do one of two things:

If you go for option number two, then you will primarily only be able to manage your salon, because you won’t have the skills required to work in it yourself.

I highly recommend doing both.

It’s much easier to be a boss and manage excellent employees when you are experienced in the industry yourself. 

Depending on the services you want to offer, you will need one or several of the following licenses:

Here’s a list of potential services you might want to offer:

While this list should give you a pretty good idea of which services you might want to offer at your beauty salon, there are plenty of other possibilities. 

This list is just the tip of the iceberg.  

You can expand this business in many different directions. 

One option is to offer hairdressing services as well. 

Alternatively, you might also want to create a service specifically for makeup.  

Bridal makeup is hugely profitable and offering high school prom makeup services might also be a great source of income. 

As you can see, the options are endless. 

Bring some creativity to the table and offer services that no one else has. 

Getting noticed from the crowd is the only way to keep up with your competitors, and offering unique services is a great way to do that.

3. Choosing A Location

Among the most important things about a beauty parlor is its location. 

Unless you’re running your beauty business from home, your location determines your parlor’s visibility, and how many walk-in customers you might get on a daily basis.

When starting out, walk-in’s will be extremely important until you’ve had time to establish a loyal base of returning clients. 

More rural areas might have very little competition, but you need to ensure there are enough customers nearby to make it worth your time and effort. 

Whereas a big city will offer more high paying clients, but with the trade-off of great competition nearby.

It’s a balancing act between these factors. 

Ideally, you should look for a location that offers high traffic, and reasonable rent prices.  

When selecting the location of your salon, it’s important to thoroughly research the demographics of your area.

This is why it’s important to know your niche, because your niche will determine which demographics you are looking for within a particular area. 

Important location demographics to look at for your niche are:

Accessibility is also a factor. 

Make sure that your beauty parlor isn’t too far off the beaten trail, and that there’s adequate parking nearby. 

Sometimes, parking and other small details have a larger impact on your business than you might think. 

It’s best to take everything into account when choosing your location.

4. Setting Your Prices

Figuring out how much each service will cost is an important part of building your business plan. 

There are many factors to take into account. 

First of all, consider how much time it takes to complete the service.  

Longer services should cost more.  

This becomes more important when you start hiring employees because you’ll pay them an hourly wage.

The complexity of the service will also be a factor.

You also must take into account how much skill is required to perform these services. 

After all, you need to offset the costs of any training or certification you might have obtained. 

Next, factor in the cost of your supplies.  

You’ll need to crunch the numbers and do some serious math for this calculation.  

Next, you should consider what the industry standard pricing is.  

Note that this standard might not necessarily be the same as your nearby competitors. 

They might offer the same services for less or more than the industry standard. 

Finally, you’ll need to check on your competitors and figure out what their pricing system looks like.

Take these factors into account, and then build your unique pricing around it.

Your pricing has to effectively compensate you, remain relevant to industry standards, and fair to your customers. 

Charging a low price might seem tempting, as it’ll give you an edge over the competition. 

But customers might also see you as low-quality because of low prices, and you might lose money.

It’s best to strike a nice balance between respecting yourself and staying competitive.

5. Purchasing Supplies

As you run this business, one of your biggest expenses will be your supplies. 

All kinds of different supplies are necessary for beauty parlors, and you will need a variety of different supplies based on which services you offer.

For example, if you’re offering nail services, you won’t just need nail polish.

You’ll also need specialized lamps for drying nails, files, buffers, and much more.

And if you’re offering facials, you’ll need specialized masks, cloths, serums, oils, creams, and more.

Even hairstylists need far more than just a pair of scissors…

The amount of product, color, toners, and shampoo that they go through in a week is mind blowing.  

Ultimately, the best way to keep the cost of supplies down is to find which products you use the most, and purchase them in bulk. 

Purchasing wholesale cosmetology supplies will be much cheaper in the long run than buying each tube of color by itself as you need it. 

Ordering online is certainly an option, but you might also find wholesale suppliers in your area.  

These beauty depots contain everything you need, and you can get deals based on how much you buy. 

If you go through product faster than anticipated, it can be extremely convenient to be familiar with your local beauty wholesale supply store… 

Rather than waiting on a shipment to arrive from an online order. 

While different services require specialized supplies, there are some basic items that you’ll need for most salons:

6. Hiring Staff

At some point, you’ll need to hire staff for your beauty parlor.

Maybe at first you’re content to run your business from home as an independent entrepreneur...  

There’s nothing wrong with this approach, but your business (and therefore your paycheck) will only be able to grow so far.

In order to push this business to its full potential, you’ll need to rent out a business space and hire employees.

This is an important step towards building and expanding your business because your employees have direct contact with your customers. 

Your hiring process ensures that your customers are getting the best experience possible.

Hiring staff also allows you to add new services to your business.  

You might not be qualified to give massages or facials, but you could hire someone who is! 

Adding new, skilled employees makes your business more versatile and more valuable.

As a general rule, it’s best to hire staff that have some form of training; even they’re performing basic services such as manicures.  

Untrained staff might cause health problems or injury because of improper technique 

But skills and training are only part of the equation. 

You also need to take into account the personality of your new employees.

Remember, you’re building a team. 

If you think one person might cause trouble or drama within the salon, they’re probably not a good fit – even if they’re the most qualified candidate in the world.

Wages represent a major part of your overall operating costs. 

There are a number of systems you might consider:

Another common structure is to rent out booth space in your salon to a variety of different cosmetology professionals. 

This way, they will have their own space, and technically they wouldn’t be your employees.

Renting out booth space in your salon to a variety of different cosmetology professionals is a very common salon structure. 

The benefits are that each stylist will have their own space, and technically they wouldn’t be your employees...

Which takes some responsibility off your shoulders financially.

But they would still represent your business, brand and salon.

7. Marketing Your Beauty Salon

Like most businesses, your overall success depends on a solid marketing strategy.

Part of this involves branding. 

Create a beauty salon which reflects your unique personality and hone your branding based on these attributes.  

Don’t be afraid to get creative and stand out from the crowd.  

Beauty salons offer very personal services, so if your personality and brand speaks to them…

Then it’s probably because your salon is going to be a great fit for them.  

Because of this, marketing yourself is a big part of marketing your business.

Make sure that potential customers feel welcomed into your salon, and work to create a friendly, relaxed atmosphere.

Every customer should feel special, as these services are luxury experiences that your clients are treating themselves to. 

There are many ways to make your salon unique and interesting. 

A great way to set the atmosphere is through music.  

Or even choosing eclectic and inviting decor for your salon space.  

You can even choose a theme that fits your brand and decorate based on this theme. 

For example, a tropical themed salon might have a variety of tropical plants throughout the space as well as bright colors and chill, beach-y music. 

If you’re going for a more luxury spa-like salon, consider spending a little extra on your furniture and create a space that is tranquil, elegant, and zen. 

Aside from branding, you have many different options for your marketing strategy.

Creating a website is always a good first plan of action. 

Fortunately, you don’t have to hire a graphic designer unless you want to and you have the budget for it.

You can keep costs down by building your own website with a user friendly, template based website builder.

These are some of my personal favorites:

Without a website, customers won't be able to find you through Google. 

Speaking of Google, you should also start a Google My Business account as soon as possible for even greater visibility.

A GMB page will help your website rank higher within Google, which means that more people will be able to find your salon online. 

Social media is perfect for marketing a beauty parlor. 

You can promote your business every time your customers get a service. 

Take pictures of the before and after results and post it to social media.

This strategy works especially well for interesting nail art designs, as well as haircuts and color.

You might also consider creating a blog or a YouTube channel explaining your various services and even offering beauty tips.

Email newsletters are another incredibly effective marketing method and they can provide some of the best marketing and lead generation results. 

Email newsletters help you communicate and interact with your customers on a consistent basis…

Keeping them updated about new services and developments in your business. 

You might even offer exclusive deals and coupons through your email list that will motivate people to subscribe!

If you’re running your beauty salon from home, these marketing techniques are even more important, because you won’t have the luxury of relying on walk-in clients for additional business.

But a strong marketing strategy requires more than just a killer website, GMB page, and social media.

Ultimately, you will have to be prepared with a lead generation strategy that will attract new customers to your business on a consistent basis.

Fortunately we can teach how to do exactly that through our local lead generation coaching program and online course.

8. Creating Branded Products And Expanding

As your business expands, you may eventually reach a point where you can’t create additional profit with your current space limitations…

You might want to consider opening a second location. 

This is a great problem to have! 

In fact, you may even be able to start a franchise in the future.

While this might be a great opportunity to expand and earn more money, it will also require more work.

You also risk damaging your salon’s reputation as a franchise forces you to allow other people to run your businesses. 

While stepping into a more “behind the scenes” role might sound like a lot less work, this isn’t always the case.

Managing multiple franchise locations is an entirely different set of responsibilities that you will have to learn and adapt to. 

If you’re not interested in opening other locations and hiring tons of additional staff, you can consider creating your own signature product lines.

This could be a great way to explore a new revenue stream while still focusing on your niche and primary location.

Research the manufacturing process of things like:

As well as any other beauty products you might be interested in producing.

Having a branded line of products for your salon can be a very profitable decision.

The marvelous thing about this strategy is that you already have a customer base!

Market your products to your existing customers as they come in for services. 

You’ll find that many of your loyal customers are willing to support your new product-based business.

You can also market these products online, giving you access to an international market that would’ve been otherwise inaccessible.

Overall, creating products is a great way to expand your business without massive additional investments.

9. Licensing, Insurance, and Inspections

Like almost any business, you’ll need a business license to operate your beauty salon.

Without a proper business license, your salon won’t be legal, and you’ll be shut down. 

In addition to a standard business and the variety of different cosmetology licenses that we discussed earlier… 

You will also need to obtain the following:

Insurance for a salon is also very important. 

Without proper insurance, you put yourself, your clients, and your employees at risk.

The average salon needs a General Liability Insurance, Commercial Property Insurance, Professional Liability Insurance, and Workers Compensation Insurance. 

Without insurance, you’re totally at risk for all kinds of disasters, legal action, and things outside of your control. 

Without insurance, you could lose everything in the event of a fire or a flood, for example. 

Or one of your customers might also sue you for injuries.

These are just a few examples of the reasons you need solid salon insurance.

As part of the permit and licensing process, your business may be inspected by local officials.  

They’ll be searching for safety, health, and hygiene concerns. 

It’s very important to keep your beauty salon clean at all times – even after you’ve successfully obtained your permits and licenses. 

Your salon will have to pass regular inspections, similar to health inspections for restaurants.

The best way to ensure that your salon passes these inspections with flying colors each and every time… 

Is to create your own inspection checklist, and perform regular self inspections of your salon space.

This will help both you and your employees to be prepared for official inspections. 

Beauty salons deal with people’s skin, nails, hair, and other potentially dirty areas. 

Disease, fungus, and infections might spread rapidly through the salon if you’re not careful.

Always sterilize any equipment you’re working with and clean the entire salon regularly. 

The last thing you need as a new business owner is for your salon to develop a reputation for being dirty and unhygienic.

Starting a Beauty Salon Business Can Work, but Lead Gen is Better, Here's Why:

Let’s be real…

Nobody wants to see those chunky, blonde, early 2000’s highlights make a comeback.

They’re just so out of style now!

And although Miley Cyrus has somehow managed to salvage the reputation of the infamous mullet…

There are some things that are just better left in the past.

The one thing I was ready to toss to the curb like a bad fashion trend?

Trading my time for money.

Passive income is the hot new trend in entrepreneurship.

Well, if we’re being honest here…

Passive income isn’t a trend and it isn’t new, but run with my analogy here, will you?

Starting a beauty salon has a lot of potential, but the harsh reality is that your success will be directly tied to the hours that you work.

In fact, opening a salon will probably demand more of your time and energy than a traditional 9-5 office job.

If you’re ready to free up your life without sacrificing your paycheck, then there’s a better way!

The business model that changed my life and revolutionized the way that I look at passive income is online lead generation for small businesses.

Local lead generation took me from making around $2,200 a month at my old job…

To making over $50,000 a month in five years!

And now that I have my online lead gen properties well established…

I get to sit back and let my money work for me!

Plus I get the bonus of helping other small businesses to scale and grow by supplying them with a steady stream of SEO generated business leads.

Think about this:

If you really want to start your own salon…

How great would it be to have a sustainable stream of passive income funding your business endeavors?

Pretty great, right?

So if you're ready to find out what local lead generation can do for you, click here to learn more about how we can help you get started.