How to Write a Salon Business Plan -step by step & Free Template

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Transforming people’s looks and making them feel confident and beautiful is exciting, but before you dive headfirst into the world of colour consultations and perfect blowouts, let’s talk about a crucial step: crafting a beauty salon business plan.

Think of your business plan as a roadmap to success. It will guide you from those initial dreams to a thriving salon, outlining your goals, strategies, and the financial magic that will make it all happen. It’s also a fantastic tool to impress potential investors or lenders who might be interested in helping you turn your vision into reality.

We’ll break down the essential sections of your salon business plan, making the process clear and achievable. Plus, we’ve got lots of digital tools to make your journey easier!

How to create your salon business plan – The Steps 

1. The Executive Summary 

The executive summary of your salon business plan is an overview of your entire business plan. Use this to highlight the key points that make your salon unique and primed for success. Here’s what to include:

• What sets your salon apart from the crowd? Are you specializing in a specific service like keratin treatments or hair extensions for a particular clientele? Maybe you’ll focus on using only organic and cruelty-free products. Briefly explain what makes your salon stand out.
• Who are your ideal clients? Age, demographics, and interests will help you tailor your marketing strategy later. Are you envisioning a salon that caters to busy professionals who need express lunchtime manicures, or a luxurious haven for brides-to-be seeking a complete wedding day beauty experience?
• Briefly mention your projected revenue and growth to showcase the potential of your salon. This doesn’t have to be super detailed at this stage, but it should give investors or lenders a sense of your financial goals. You can also include how you intend to use the funding and mention your sources of funds. 

2. Company Description – Unveiling Your Salon’s Story

Now that you’ve laid the groundwork with your executive summary, it’s time to showcase your passion for the beauty industry and create a clear vision for your future clients.

Your Mission Statement

Your salon business plan mission statement should capture your core values and what truly inspires you to create this business. It’s not just about offering haircuts and facials; it’s about the impact you want to make on your clients. Here are some things to think about:

• What makes you passionate about the beauty industry? Is it about helping people feel confident and empowered? Or maybe you’re passionate about using sustainable practices and offering eco-friendly services.
• How do you want your clients to feel after visiting your salon? Relaxed, pampered, and beautiful? Confident and ready to take on the world?
• What makes your approach to beauty unique? Do you focus on personalized consultations and creating a welcoming environment?

Feel free to use AI tools to brainstorm your mission and vision statements, but remember to keep them concise, clear, and something you can genuinely stand behind.

Here’s one AI tool (Nichesss) that we use to generate these statements.

Here are some mission statement examples to spark your creativity:

• “To empower clients to embrace their inner beauty and confidence through personalized hair and makeup artistry in a warm and welcoming environment.”
• “To provide exceptional beauty services using sustainable practices and high-quality, cruelty-free products, leaving clients feeling pampered and eco-conscious.”

Defining Your Vision

While your mission statement focuses on the “why” behind your salon, your vision statement outlines the “where” – your long-term goals and aspirations for the future. 

• Where do you see your salon in 5 or 10 years? Do you dream of opening a multi-location chain or becoming a renowned destination salon for a specific service?
• What kind of reputation do you want to cultivate? Do you want to be known for innovative techniques, exceptional customer service, or a commitment to social responsibility?

Here is a vision statement example::

• “To become the leading eco-friendly salon in the city, offering a luxurious beauty experience that prioritizes sustainability and client well-being.”

3. Choosing Your Business Structure

The legal structure you choose for your salon will impact taxes, liabilities, and how you run your business. Here’s a breakdown of the most common options for both the US and UK:

US

• Sole Proprietorship: The simplest structure to set up, but you are personally liable for all business debts. This is a good option for businesses with low risk and a single owner.
• Limited Liability Company (LLC): Offers personal liability protection for business debts while allowing for more flexibility than a corporation. This is a popular choice for small businesses as it offers a good balance between ease of operation and liability protection.
• Corporation: Offers the most legal and tax advantages, but can be more complex to set up and maintain. This structure is typically chosen by larger businesses seeking greater access to capital and potential tax benefits.

UK

• Sole Trader: The simplest to set up, but you have unlimited liability for business debts. This is a good option for businesses with low risk and a single owner.
• Limited Liability Partnership (LLP): Offers personal liability protection for business debts, well-suited for partnerships with shared ownership. This structure is popular for businesses with multiple owners who want to limit their personal liability.
• Limited Company (Ltd.): Offers the most separation between you and the business, ideal for reducing personal liability. This structure is a good choice for businesses of all sizes seeking to limit owner liability and raise capital through investors.

Please remember that consulting with a business advisor can help you choose the most suitable structure for your specific needs.

Location, Location, Location!

The location of your salon will significantly impact your clientele and overall ambience.

Whether you choose a bustling downtown storefront, a convenient home-based haven, or a mobile setup offering on-site services, pick a location that reflects your brand and caters to your target clientele.

Here are some factors to consider:

• Target Market: Where does your ideal client live and work? Choosing a location convenient for them is key.
• Accessibility: Is the location easily accessible by public transportation or has ample parking?
• Competition: Research existing salons in the area to avoid oversaturating the market.
• Zoning Regulations: Ensure the location allows for business use and meets any necessary zoning requirements.

4. Market Analysis: Knowing and Analysing your competition 

Understanding the market landscape is crucial for your salon’s success. Knowing your competitors is like having a secret weapon. Here’s how to research them effectively:

Start by Identifying Your Competitors: Who are the other salons in your area, both direct and indirect? Are there high-end salons offering a full range of services, or budget-friendly options focusing on specific services like haircuts or manicures? Look beyond immediate competitors and consider mobile makeup artists or barbershops that might cater to a similar clientele.

Complete a Competitive Analysis: Visit their websites and social media pages. Check out online reviews and see what clients are saying about their experience. Analyze their services, pricing, and overall brand image.

List Their Strengths and Weaknesses: What are your competitors doing well? What areas could they improve on? Look for gaps in the market where your beauty salon can offer something unique, whether it’s a specific service, a more personalized experience, or a focus on a particular niche clientele.

Don’t be afraid to visit your competitors in person! This will give you a firsthand look at their atmosphere, pricing, and target audience.

Understand Market Demand: What Makes People Tick?

Understanding current market trends and what people are looking for in a salon is very important. 

Industry reports and beauty publications often provide valuable insights into current trends and consumer preferences. Look for reports on topics like popular hairstyles, skincare concerns, or the rise of eco-friendly beauty products.

A good example is study conducted by McKinsey that provides growth projections for various beauty categories. The study highlights that consumers are now seeking beauty products that not only enhance their appearance but also contribute to their well-being. Additionally, the research includes data on the growing interest in wellness, sustainability, and inclusion among ‘Gen Z’ consumers.

At this stage, you can also research what styles and techniques that are gaining traction, what products are getting rave reviews, and what kind of salon experience people are looking for. Social media would be a great place to start, and this is where social media listening comes in– monitoring the trends, keywords and reviews in real time. 

5. Think about the products and services you wish to offer

Now that you’ve explored the competitive landscape and market trends, it’s time to shine a spotlight on the heart of your salon – the products and services that will make your clients feel confident and beautiful! Here are some questions to ask yourself:

Are you focusing on classic cuts and colours, or will you offer trendy balayage and ombre techniques? Do you specialize in hair extensions or treatments for specific hair types (curly, damaged, etc.)?

 Will you provide facials, waxing, or specialize in acne treatment? Consider offering customized skincare consultations and product recommendations.

Are you offering classic manicures and pedicures, or will you specialize in trendy nail art and gel extensions? Consider catering to men with a dedicated men’s grooming service.

Do you offer everyday makeup applications or specialize in bridal or special event makeup? Consider offering makeup lessons for clients who want to learn how to apply their makeup flawlessly.

Always keep in mind that simply listing your services is not enough. Vividly describe them and use language that paints a captivating picture of the unique experience you will create for your clients.

Also, focus on your Unique Selling Proposition (USP).

What sets your salon apart? Here’s where you highlight your niche and what makes you stand out from the competition:

Do you offer a unique service or technique like microblading for eyebrows or a signature facial treatment?

Do you cater to a specific clientele, like men’s grooming or a salon specifically for African American hair?

Are you committed to using only organic and cruelty-free products and sustainable practices?

The Power of Packages and Loyalty Programs

Enticing packages and loyalty programs are fantastic ways to keep clients coming back for more and boost your salon’s revenue. Consider adding details on any potential Loyalty points programs, birthday discounts, and referral incentives which you may have to encourage repeat visits and build customer loyalty.

We use BoomerangMe as for our loyalty program.

6. Start working on your salon marketing plan/ strategy

Before diving headfirst into marketing strategies, take a step back and get to know your ideal client inside and out. Consider demographics: Age, gender, income level, and location are all crucial factors. Knowing your target demographic helps you tailor your message and choose the right marketing channels.
What about your customers’ interests? What are your ideal clients passionate about? Are they beauty enthusiasts who follow the latest trends? Or busy professionals who value convenience and time-saving services?
Challenges and Pain Points: What beauty concerns or challenges do your ideal clients face? Do they struggle with dry skin, frizzy hair, or finding time for self-care? Understanding these pain points allows you to position your salon as the solution.

Create your marketing mix

Here, you’ll develop a multi-channel marketing mix to captivate your audience truly.  Choose the channels that best suit your target audience and budget:

Become a Social Media Superstar: Create a captivating presence on platforms like Instagram, Facebook, and TikTok. Share high-quality photos and videos showcasing your work, stunning before-and-after transformations, and happy client testimonials. Run engaging contests and polls to boost interaction and brand awareness.
Build a great website: Your website is your online storefront – make it shine! Invest in a user-friendly, mobile-friendly website that’s easy to navigate. Include clear information about your services, pricing, booking options, and the amazing team behind your salon. High-quality photos and a captivating “About Us” section will give potential clients a taste of your unique salon experience. 
Local Partnerships: It’s All About Collaboration: Partner with complementary businesses in your area to expand your reach. Think clothing boutiques, fitness centres, or even local makeup artists. Offer cross-promotions or joint events to tap into each other’s client base.

Build an email list: Collect customer emails and send out regular newsletters or promotions to keep your clients engaged and informed about new services or special offers.

7. Think about your Salon Management Team

At this point of the salon business plan, it’s time to focus on the amazing team that will bring your vision to life. The management and organisation section is all about building a dream team – the stylists, estheticians, and salon superstars who will transform your clients and make them feel confident and beautiful.

Briefly introduce yourself and your team’s qualifications. Are you a seasoned hairstylist with a passion for colour transformations? Does your team have experience working with diverse hair types or specialize in a particular area like bridal makeup?

Let your passion for the beauty industry shine through! Explain what excites you about creating a welcoming and positive environment for your clients.

Here are some tips for assembling your all-star team:

• Clearly Defined Roles: Outline the specific roles you need to fill, whether it’s experienced stylists, licensed estheticians, or a receptionist to manage appointments and bookings.
• Seek Out Talent: Advertise open positions online, network with beauty schools, or attend industry job fairs to find qualified candidates.
• Experience Matters: Look for individuals with relevant experience and a proven track record of success.
• The Right Fit: It’s not just about skills – find team members who share your vision, values, and passion for creating a positive client experience.

If possible, remember to consider offering ongoing education opportunities for your team. This could involve attending workshops, conferences, or online courses to stay up-to-date on the latest trends and techniques.

Building a Strong Team Culture is also highly important. A happy and motivated team translates to happy clients! Foster a positive and supportive work environment where your team members feel valued and appreciated.

With a passionate and talented team by your side, you’ve laid the groundwork for a successful salon that will leave clients feeling beautiful and empowered.

8: Time for Sales & Financial Projections

Now that you’ve envisioned your salon’s stunning atmosphere, passionate team, and captivated clientele, it’s time to translate that dream into a concrete financial plan. 

Before you open your doors, there are essential expenses to consider. Here’s a breakdown of some key start-up costs:

• Salon Location: Rent, security deposit, and any renovations needed to transform the space into your dream salon.
• Equipment and Furniture: Salon chairs, styling stations, shampoo bowls, treatment tables, and other necessary equipment. 
• Inventory: These could be haircare products, skincare lines, makeup essentials, and any other products you’ll be offering to clients.
• Technology: Things like a reliable appointment booking system, point-of-sale system to process payments, and computers for managing client records.
• Marketing and Promotion: Budgets for website development, social media marketing campaigns, and any promotional materials like brochures or flyers.
• Licensing and Permits: Any necessary licenses and permits required to operate your salon legally.

Be sure to factor in additional costs like insurance, utilities, and initial inventory purchases when calculating your start-up budget.

Operational Costs: The Day-to-Day Financials

Once your salon is up and running, you may have ongoing operational costs to manage such as:

• Payroll (if you decide to have a team): This includes salaries and wages for your stylists, estheticians, receptionists, and any other team members.
• Rent and Utilities: Don’t forget about your monthly rent or mortgage payment, as well as utilities like electricity, water, and internet.
• Inventory Replenishment: Factor in the cost of regularly restocking your product inventory to meet client demand.
• Marketing and Promotion: Allocate a budget for ongoing marketing efforts to maintain brand awareness and attract new clients.

Income Projections: How Your Salon Makes Money

Here’s where you’ll forecast your income based on your services and products:

• Service Revenue: This includes income from haircuts, colour treatments, facials, waxing, makeup applications, and any other services you offer.
• Product Sales: Factor in revenue generated from selling haircare products, skincare lines, makeup, and any retail items you stock in your salon.

Securing Funding (Optional): Turning Dreams into Reality

If your start-up costs exceed your personal investment, you may need to secure funding from a bank loan or an investor. Having a well-crafted financial plan with realistic projections will be essential for convincing lenders or investors to support your salon venture.

By creating a solid financial plan, you’ve equipped yourself with the tools to manage your salon’s finances effectively, ensuring your dream becomes a thriving and sustainable business.

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Grab your free copy from our good friends at PandaDoc. This template will guide you through each section of your plan, making the writing process smooth and organized.

Congratulations on taking the first step towards making your salon dream a reality!