Crafting my salon suite business plan: The proven model and tips

You enter a salon business with a dream to prosper. However, all the challenges associated with establishing operations and drawing in a steady stream of customers can be staggering. This is where a savvy salon suites business plan becomes your compass, leading you from startup uncertainty to long-term success.

Here, we’ve collected tips that will help you develop your roadmap and attract investors to move toward the triumph of your venture.

Understanding the salon suites business model

Salon businesses can be based on different business models: independent ownership, franchises, hybrid companies – you name it.

Experience shows that leasing ready-to-move-in facilities in popular locations with an active flow of people (potential customers) is the most optimal salon suite business model for a newbie entrepreneur. It immediately removes the problem of finding a suitable place to get started. You have your own furnished studio space and all the supporting infrastructure and are free from the responsibilities of establishing a salon from scratch.

Building blocks of my salon suite business plan

Before drafting the document, we advise that you understand your mission and vision. We will dwell on these concepts below as part of your business plan, but for now, you should decide for yourself how you see your venture. This directly affects the choice of facilities for rent, outlines your purpose, and impacts many other aspects.

For example, if you are an esthetician, your vision may be something like:

To set up a place that makes people naturally beautiful.

Meanwhile, your mission may sound like this: 

To create a welcoming space for people to get the latest laser treatments in California.

Once your understanding of the vision and mission statements is shaped, you can proceed with a business plan for a salon suite using these 5 building blocks or steps.

Step 1. Adjust your compass through an executive summary

You’ll want to start with an executive summary. Keep it around 2-3 paragraphs to give readers a quick overview of your idea before they dive into the nitty gritty. Describe your projections in catchy phrases to hook them from the start. That’s where you’ll put:

• Mission and vision. Explain what niche you intend to fill. If we go on with the laser esthetician example, do you want to provide a full range of hair removal services or a specific service? Are you planning on becoming the leading laser salon in your city? Envision your future and how you will get there.
• Business model. Describe how your model functions and explain how it benefits your clients. For instance, say that your facilities allow for reduced discomfort with hair removal treatments or give your suite other advantages over the competition. Briefly mention them in your executive summary.
• Financial projections. Calculate your potential revenue over the following years (preferably 3-5) based on average treatment fees and the number of clients you expect to serve. Estimate costs like rent, supplies, marketing, and payroll. If your revenue exceeds the costs, your venture is viable.

Step 2. Explore customers and market dynamics

To craft a salon suite business plan that gets results, you should pinpoint who you’re aiming to serve. Determine the primary age groups of your potential clients, their income levels, and lifestyle factors. Discovering their preferences allows you to fine-tune your offerings.

Besides, you should analyze:

• Competition. See what other salons are doing in terms of social media promos, services, pricing, and overall ambiance. Look for any gaps you can fill or ways you can improve upon their model.
• Demand. Based on population statistics within a reasonable radius of your salon suite location, estimate the number of clients you expect in your first year. Don’t forget to account for seasonal fluctuations.
• Risks. Your potential investors will appreciate critical considerations associated with your venture, like an economic downturn reducing discretionary spending, changes in consumer trends, or new technology making some services obsolete.

Step 3. Define your signature services

Carving your niche and identifying your distinguishing features is paramount in a salon suites business plan. These may be your services, location, products, or expertise. For example, if you are certified in some of the latest techniques, that expertise sets you apart. To truly stand out, however, you’ll want to develop signature services built upon your strong skills and qualities. 

More food for thought:

• One service only. Will it be body hair removal? Facials? Dermabrasion? Based on the previous analysis and your competencies, decide what specific service you can provide to keep clients popping in.
• Salon with a broad menu. Perhaps the best you can do is to provide all services in one place. Your expertise as an esthetician may be extended by nail care or massages to address every client’s need under one roof.
• Experience beyond the ordinary. Look for ways to enhance your key service by creating add-ons, like eye treatments, to complement your famed facial or leg hair removal procedures. Packaging multiple services at a discount makes a good impression.

Step 4. Do the math

Solid financial estimates (usually for at least 3 years) are the mainstay of a winning business plan for salon suites. They help you understand whether your salon idea is workable or just a pipe dream. 

To make realistic projections, analyze financial data from comparable salon suites. Factor in your planned offerings, pricing, and operating costs to pin down:

• Revenue forecasts. Estimate the clients you can serve weekly at your price points for each service. Calculate retail revenue based on industry standards for product sales as a percentage of service revenue.
• Expense projections. Predict product costs using your existing assortment and wholesale pricing in the industry. Account for personnel expenses based on compensation packages, as well as rent, utilities, and marketing costs.
• Flow of funds. Now, you should compare your revenue and expenses. Calculate cash inflows from services, product sales, and other sources. Do the same for money that leaves your business for supplies, rent, and stylists (if you’ve employed any). Be sure to build a buffer each month.

Step 5. Sketch out your marketing strategy

The bedrock of effective marketing is identifying your target clients. Your next step is determining how to communicate with them. Some time-tested channels worth mentioning in your salon suite business plan encompass:

• Direct mail. Who said direct mail is dead? For a salon, this channel can be highly effective, especially when it marries enticing offers, service packages, and seasonal specials.
• Social media. Craft your online identity on platforms where your target clients spend time, e.g., Facebook or Instagram. Post eye-catching photos of your space and treatment results. Share offers and new launches.
• SEO. Fine-tune your website for prime search engine rankings. Focus on location-based phrases like “salon suites” + your city. Leveraging SEO and blogging amplifies your visibility.

Thinking over a salon suite business model and plan may not be the most exciting part of starting your venture. However, this allows you to look at your business from the outside – through the eyes of a prudent entrepreneur.