The beauty industry is booming, with the global market projected to reach $217.25 billion by 2026. As consumers increasingly prioritize self-care and pampering experiences, beauty bars that offer hair, nail, makeup, waxing, and other services in a relaxing salon setting have become widely popular.

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Opening your beauty bar allows you to tap into this high-demand market while also doing something you love. Launching a successful beauty business requires potentially going to beauty school to learn the craft, careful planning and preparation first. From choosing a niche and location to acquiring the right licenses and insurance, many factors go into a beauty bar.

This guide will walk you through how to start a beauty bar. Topics include market research, registering an EIN, branding your business, sourcing equipment, marketing, and more. Here’s everything salon owners need to know to get started.

1. Conduct Beauty Bar Market Research

Evaluating the viability of a beauty bar begins with thorough market research. This involves assessing the overall industry outlook in addition to zoning in on trends, target market, and competition in your specific locale. Market research helps you develop a solid business plan.

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Some details you might learn through beauty salon and mobile beauty salon market research include:

• Independent salons make up a sizable segment, indicating room in the market for new single-unit ownership beauty bars.
• Profit margins are healthy as well, averaging 17% for hair salons specifically.
• When committing to a specific location, carefully analyze demographics within a 2-3 mile radius.
• You’ll want a population density of at least 30,000 with a visible presence of your target demographics.
• Hair and nail salon clients tend to be middle and upper-class women from their late 20s through late middle age.
• Modern beauty bars also successfully draw in male clients and a younger, diverse set of customers for blowouts, makeup, eyelash extensions, and microblading.
• Spend ample time surveying existing neighborhood beauty businesses by visiting in person.
• Count the number of salons and individual stylists within a few-mile area to determine if there’s sufficient demand for another entrant.
• Closely evaluate Yelp, Google, and Facebook ratings and reviews for competitors.

Interview several working stylists to further understand typical earning potential in both booth rent and commission compensation models. Connect with a commercial real estate agent knowledgeable of the local rental market. They can provide critical intel on availability, pricing, and qualifying requirements.

2. Analyze the Competition

Carefully scrutinizing competitors equips you to carve out your niche within the local beauty market. Assess established salons through extensive in-person visits and web stalking.

Some ways to get to know competitors in the hair salon market include:

• For brick-and-mortar monitoring, assume the role of a mystery shopper.
• Evaluate at least five neighboring salons, assessing factors like design aesthetic, cleanliness, technology utilization, customer service, and general ambiance.
• Document their location accessibility, visible signage and displays from the street, availability of parking, layout, retail displays, and any amenities like refreshments.
• Pay attention to how busy each salon is at different times of day and the general demographic mix of clientele.
• Discuss pricing openly with receptionists to gauge average checks for common services like highlights, lash extensions, manicures, and Brazilian blowouts.
• After in-salon evaluations, dig deeply into each competitor’s web presence and social media accounts.
• Google every salon to analyze how their profile appears in local search results, and other highlighting factors that sway local client selection.
• Check all salon websites for functionality, navigability, visible contact info, visual appeal, calls-to-action, and tools like online booking.
• Note which sites need updates, have broken links, lack calls-to-action, or don’t display properly on mobile.

As the new salon owner on the block, this intelligence gathering on market competitors sets you up to meet local consumer needs more effectively. You can identify service gaps to fill or utilize untapped marketing tactics that set your beauty bar apart online and on-premise.

3. Costs to Start a Beauty Bar Business

Starting your own beauty salon requires facing a few expenses. From obtaining your business license to renting office space, here are the common startup and ongoing costs to consider.

Startup Costs

• Lease terms average 5 years for most units, with base rents ranging from $25-$45 per square foot in most markets.
• A 1,200-square-foot space clocks in around $36,000 for first-year rent plus your upfront $12,000 security deposit.
• Budget $30,000-60,000+ for a full build-out on a bare-walled space.
• Salon chairs – $800-$1,500 per chair
• Shampoo stations – $700-$1,200 each
• Pedicure spas – $2,500-$5,000 per unit
• Manicure stations – $300-$800 per table
• Facial beds – $2,000-$5,000 each
• Hair washing sinks – $500-$1,500 each
• Hot towel cabbies – $300-$800
• Dispensing units – $300+ -Reception desk – $1,200-$3,000
• Retail displays – $500+ -iPads/tablets for reception – $300+ each

This totals around $12,000-$22,000 to outfit just a base-level suite with high-quality equipment. With 8-10 stylist stations planned, costs inflate further.

Ongoing Costs

Final necessity- a robust point-of-sale system for appointment booking, payroll, inventory management, and analytics. Top salon software costs $200-$400 monthly for capabilities like online scheduling integration, customer records, and automated SMS and emails.

Staffing demands a hefty chunk of monthly operating expenses from here forward as well. Hiring 2-5 full or part-time additional licensed stylists along with 1-2 receptionists or assistants adds at least $8,000 per month. Employer payroll taxes and workers’ compensation insurance boost this tally even higher.

Other fixed monthly costs include:

• Rent/mortgage – $3,000+
• Utilities – $500+
• Insurance – $200+
• Software subscriptions – $500
• Credit card processing fees – 1-4% of revenue
• Professional services like bookkeeping and legal retainers

Keep ample operating capital on hand for unexpected repairs, slow revenue months as your clientele expands, and marketing efforts like advertising and promotions to continually attract new local businesses.

4. Form a Legal Business Entity

Structuring your beauty bar under the right legal entity safeguards your assets and eases any future expansion plans. There are four main business entities to consider as you develop your own salon.

Sole Proprietorship

Sole proprietorships only require registering a DBA name and then reporting all salon income and expenses on your tax return. And without needing to file formation documents, it’s the quickest route to open doors. As a single owner, you’re personally responsible for any company debts, lawsuits, or claims.

Partnership

Formal partnerships allow the sharing of startup costs and workload between two or more stylist partners. But similar to sole proprietors, each general partner remains personally liable for the full company. This untenable risk exposure makes other entities more appealing.

Corporation

C-corporations let you sell stock and attract outside investors, necessary for major growth plans. But C-corps fall short for most independent beauty bars since company profits get taxed first at the corporate rate and then again as personal income when distributed to individual shareholders.

Limited Liability Company (LLC)

For shielding personal assets underneath the corporate veil while benefiting from pass-through taxation, most beauty bars opt for LLC designations. LLCs limit liability solely to the company itself, protecting your house, bank accounts, or other properties unrelated to the business if sued.

5. Register Your Business For Taxes

With your corporate entity formed, next tackle requisite tax registrations to operate legally. Every beauty bar must obtain an employer identification number (EIN) for federal tax purposes. Think of your EIN as the business equivalent of your personal instead of your social security number.

As an LLC, you’re considered either a sole proprietorship or partnership from the IRS’ perspective. So your SSN works instead of an EIN initially. However, receiving an EIN becomes essential once you begin hiring employees, open a business bank account, or file taxes separately from your return.

Thankfully securing an EIN takes just minutes online. Simply navigate to IRS.gov EIN Assistant and answer a few questions about your business structure and activities. On successful submission of the SS-4 form, receive an instant assignment of your EIN at no cost.

With your federal EIN locked in, don’t overlook needing sales tax permits and additional licenses mandated state-wide and locally. Sales tax permits apply based on whether you sell retail products in your salon space. Municipalities often require local general business licenses above state salon licenses.

6. Setup Your Accounting

With clients, employees, inventory, and revenue streams to manage, implementing organized accounting from day one helps your salon operate smoothly. Beyond mandatory tax compliance, meticulous bookkeeping and financial tracking enable data-driven decisions in your beauty bar.

Accounting Software

Begin by adopting small business accounting software like QuickBooks to automatically centralize accounting needs. Robust platforms like QuickBooks track all cash flow across integrated bank accounts and credit cards, generate invoices and pay bills, reconcile Inventory, and create payroll checks.

Hire an Accountant

Handing bookkeeping and fiscal year-end tasks to a professional accountant saves further headaches. Yes, software can auto-categorize transactions and simplify reporting. Human insight spots questionable charges provides consulting on profit maximization tactics and ensures full legal compliance.

Open a Business Bank Account

Operating business finances through dedicated small business bank accounts and credit cards streamlines the separation of personal and salon funding. Business checking accounts often waive monthly fees with minimum balances of around $1,500 and provide hundreds of free transactions monthly.

Apply for a Business Credit Card

Similarly, small business credit cards offer higher limits than consumer cards when underwritten using your EIN and company financials. Low introductory APR periods of around six months allow financing major equipment purchases and then paying down over time.

7. Obtain Licenses and Permits

Before welcoming your first client, secure legally mandated licenses and operational permits to avoid disciplinary fines or closure. Find federal license information through the U.S. Small Business Administration. The SBA also offers a local search tool for state and city requirements.

In most states, practicing beauty professionals must carry individual licensure demonstrating competency in areas like hair, nails, makeup, tanning, and skin care services. Eligibility for these professional licenses typically involves paying fees of around $50.

Additionally, facility operational permits apply for house salons with multiple stylists. State boards of cosmetology oversee and issue these shop licenses covering procedures around sanitation, record keeping, inspection compliance, and licensed personnel verification.

Seeking local general business licenses gives municipalities awareness while legally sanctioning services within city limits even for home-based solo practitioners. Town administrators mainly just want to catalog all operating enterprises for zoning allowances.

Sanitation licenses demonstrate adherence to safety requirements like sterilization procedures, shed hair disposal, and OSHA guidelines around chemical handling and air quality standards. Expect related facility inspections and personnel process verifications before issuing approval.

State sales tax permits must be displayed publicly when selling retail products despite service-oriented establishments relying chiefly on transactions for beauty treatments and labor. Require independent operators as well as employee stylists to have all credentials lined up before opening.

8. Get Business Insurance

Beyond legally required licenses, proactively safeguard your salon and livelihood with comprehensive business insurance. Asset protection via coverage becomes essential given the hands-on services, chemical usage, and facility risks inherent to beauty bars. Common policies include:

• General liability
• Property
• Workers’ compensation

Without adequate policies shielding your company, a single accident threatens total financial ruin. Envision a stylist nicking a client’s ear during a haircut and requiring an ER visit. Or an elderly customer slipping on a wet floor, breaking a hip that necessitates surgery and extended care.

Imagine a shampoo bowl catching fire from faulty wiring, igniting into a blazing salon inferno. Property damage and lost business income during repairs alone could permanently shut doors without sufficient coverage. Add in potential customer bodily injuries amidst the chaos and you’ve got a real problem.

Finally, picture a stylist teammate suffering a chemical burn from a lightener splashing her neck and chest, requiring hospitalization and extended medical leave. Lacking worker’s compensation directly foots you with covering still accruing payroll, medical bills, and likely lawsuit risks without the insurance company buffer.

9. Create an Office Space

Although client-facing operations stay on the salon floor, dedicating backstage administrative space streamlines business management. With consistent desk space for tackling paperwork and other behind-the-scenes tasks, you maintain order amidst the daily buzz of beauty services.

Home Office

For home-based solo entrepreneurs, a basic home office with a desk, computer, printer, filing cabinets, and phone line likely covers needs with minimal overhead costs. This allows handling administrative tasks around appointments and client records in between hair, nail, and facial appointments without renting additional square footage.

Coworking Office

Fast-growing beauty bars ready to move marketing, payroll, purchasing, and related project work offsite tap into shared coworking spaces like WeWork. Open workspace rentals provide room for assistants or operations managers to base out of for $300-800 monthly depending on location and access frequency.

On-Site Office

Salons sustaining enough revenue to lease stand-alone brick-and-mortar retail space often build out office nooks behind the reception desk or fixtures back wall. Though cramped, a tiny 120-200 square foot office squeezed near the breakroom or bathroom grants some operational privacy starting at around $400 monthly.

10. Source Your Equipment

Outfitting your perfect salon environment requires significant upfront equipment investments. From high-end chairs and shampoo stations to pedicure tubs, manicure tables, towels warmers, and beyond, costs add up quickly when buying everything brand new.

Buy New

Ordering straight from manufacturers and specialty beauty suppliers like Salon Guys enables completely customized aesthetic coordination in finishes, upholsteries, metal hues, stone surfaces, and wood tones. But besides the tendency to overspend once immersed in premium options, expect 8+ week delivery timelines on custom pieces.

Buy Used

Scouring local auction houses and online government and commercial auction marketplaces like GovDeals yields fantastic cost savings on quality preowned pieces. Platforms like Craigslist, and Facebook Marketplace also offer discounts.

Rent or Lease

Those on extremely tight budgets look into equipment rental marketplaces like Pro Beauty Suites. Short-Short-term leasing options around $100 monthly for a styling station bridge gaps while business funds build. However, better rates and ownership benefits make buying secondhand smarter long term.

11. Establish Your Brand Assets

Cultivating a recognizable salon identity attracts ideal clients while differentiating from commodity competitors. Beyond just a logo and tagline, intentionally curate visual touchpoints projecting your signature style.

Get a Business Phone Number

Start by securing a dedicated business phone line instead of relying solely on personal mobiles. Cloud-based systems like RingCentral provide toll-free numbers, instant call routing to any device, SMS messaging, voicemail transcriptions, and virtual receptionist capabilities starting at $30 monthly.

Design a Logo

Design visual brand imagery that conveys your beauty niche, values, and aesthetics instantaneously. Check out logo design platforms like Looka that provide easy-to-use templates to craft professional logos even without graphic design expertise.

Print Business Cards

Business cards displaying said logo offer convenient info sharing during client interactions or local networking. At minimum provide names, expertise, phone/email contacts, plus website and social media handles. Order 500 basic cards from Vistaprint for under $20.

Buy a Domain Name

Of course, securing URLs with your business name becomes mandatory for discoverability. Shop names at Namecheap first come, first served with .com registrations starting under $15 annually.

Design a Website

Building out a dedicated website then allows showcasing visual branding, communicating your unique salon vibe, attracting new local clients plus enabling online booking and retail e-commerce. Utilize Wix’s drag-and-drop templates if tackling yourself or consider hiring web developers on Fiverr starting at around $500.

12. Join Associations and Groups

Expanding your professional network builds crucial community while unlocking industry intel. Connecting with fellow beauty entrepreneurs, stylists, and influencers via memberships, local meetups, and online groups enriches expertise.

Local Associations

Joining regional associations like the Professional Beauty Association or the American Association of Cosmetology Schools provides both educational and networking opportunities. Attend annual conferences and events in your state, often including trade shows to discover new brands.

Local Meetups

Attending regular beauty meetups facilitates more casual idea exchanges and partnerships. Use Meetup to find practitioners gathering for happy hours, speaker panels, demo days, or volunteering at events. These free networking events lead to mentorships, potential job placements, and local partner referrals.

Facebook Groups

Diving into Facebook groups opens more crowdsourced learning from peers nationwide. Groups like INDEPENDENT SALON OWNERS UNITE and All Things Beauty share advice about operations, hiring, marketing campaigns, retail displays, the latest techniques, and managing behind-the-chair life.

13. How to Market a Beauty Bar Business

Implementing marketing and customer acquisition strategies fuels sustainable salon growth. While word-of-mouth referrals from current clients remain invaluable, proactively employing both digital and traditional tactics targets new local audiences.

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Personal Networking

Tap into the readymade influence of delighted customers by making asking for reviews and referrals part of your standard checkout process. After a great service experience, politely ask clients to review your business online or provide your contact info to a friend they think would appreciate your work.

Digital Marketing:

• Launch Google and Facebook ads geofenced within a 3-5 mile radius, highlighting popular services or new product offerings
• Post educational and inspirational content 2-3 times per week on Instagram, Facebook, and TikTok
• Send email newsletters with promotions and personalized content recommendations to generate return visits
• Claim salon listings on review sites like Yelp then respond promptly to all feedback
• Partner with micro-influencer stylists in feed-sponsored posts and Instagram takeovers
• Utilize hashtags like #CityNameSalons or #CityNameHair when posting work images online

Traditional Marketing

• Distribute printed flyers and menus to local businesses, colleges, hotels, and apartment complexes
• Sponsor community events to gain booth presence and hang branded banners
• Advertise in regional newspapers, local magazines, and city event calendars
• Send direct mail postcards to households announcing new talent or service expansions

While digital channels lend better measurement around spending and engagement, local impressions from grassroots promotion build trust and visibility. Blend social media content and SEM ads with targeted flyering, signage, and partnerships for complete neighborhood saturation.

14. Focus on the Customer

Obsessing positive customer experiences cements loyalty and referrals to drive continual growth. Given the intimate, often lengthy services beauty bars provide, ensure every client feels pampered and relaxed throughout their visit.

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Welcome each guest by name and offer refreshments as they settle into the stylist’s chair or treatment room. During services, check in periodically on comfort levels and provide neck pillows or warm blankets as indulgent touches.

At checkout, call attention to any retail products personalized to their needs so they feel cared for from start to finish. Don’t forget a warm goodbye with your name and a request to review the salon online or spread the word about their exceptional experience.

It’s these purposeful touches that elicit delighted online reviews, repeat visits, and rave referrals to networks like, “You have to visit Allure Salon and ask for Marie, she’s simply the best!”

By providing memorable, welcoming experiences with each visit, clients become salon devotees driving continual word-of-mouth momentum.