Hi all

I'm a trained reflexologist and am looking at opening up a health and beauty salon. We've sold our house and downsized so I've got a reasonable amount of money set aside for set up costs but I'm finding it really hard to know just how much it will cost! I've obviously gone through listing everything I would need to set up - I've found a potential property and am looking at having 4 treatment rooms and employing a salon manager and therapists, offering beauty and complementary therapies. Is there any guidance out there about how much I should be budgeting for and how I can work this out? For example, just looking at treatment rooms, once they have been partitioned, I was told I should be looking at £1,000 for decorating and kitting out each.

Also, am I mad doing this in the current economic climate? The property I'm looking at is in a very affluent area so I'm hoping it may not be quite as impacted by the credit crunch.

Guidance and opinions wanted!

Just because its affluent dosnt mean its credit crunch proof! The higher the earnings or house price usually results in a much bigger fall from grace if they get into trouble or lose their job etc!

Look at other salons in the area, are they booked up? If they are keeping busy then is there room for more? How different are you going to be from your competitiors? Is your price point more appealing?

Your looking to kit out a four room salon then list everything you need for example.

4 beauty beds, 4 therapist stools, 4 client chairs, mirrors/pictures and decor for each. Trolleys, sinks and lighting. Dont forget electrical points you need installing, will each room be set up for every treatment so each room requires wax pots, tweezers, towels, towel caddy, skincare/massage stuff etc. (think about if you have two therapists and one is in the room with all the facial stuff and another client walks in wanting a facial with your free therapist?)

Then dont forget your reception desk, computer, reception seating, shelving, decor, lighting, electrics, signage, point of sale material such as leaflets, business cards and flyers.

Then theres the little things such as washer and dryer or you going to take all the towels home each night to wash and dry. Then you will need a fridge, cups and saucers, seating for your staff, coffee and tea making facilities.

Then theres the skin care range, machines, manicures & Pedicures equipment and products including tables, chairs and filteraration, then your nail extension wange, waxing materials, gloves and other disposables, tanning products etc.

Then theres the street signs and a boards include in this the therapists outfits and your advertising constigency.

You also need about 6 months of money in the bank to keep you afloat that should enable you to pay your staff wages, rent, bills and stock until you start making ends meet.

Dont forget about other hidden costs too that are forgotton about such as websites, banking costs, credit card machine costs, phone installation and line rental, insurance, fire equipment.

Its exhaustive i admit but worth it! Your probably talking all told around £30K. (and thats what I spent on a two room salon!).

Good luck x

That's great, thanks so much for your reply! Did the money to keep you afloat come from the £30k you said you spent or was this in addition to this? Sorry for all the questions, I just really want to make sure I go into this with my eyes wide open in regard to costs and not find 2 months down the line that I haven't built in enough to keep me going whilst I'm establishing myself.

In regard to the area I'm looking at, there are a couple of places but they don't stock dermalogica which is what I want to use, and I'm also going for a more upmarket look and feel so appealing to a slightly older, more well off market. There are also a few really nice hairdressers that do not do beauty who I would try to work with.

Once you decided to open your salon and found your property, how long did it take to open your doors?

Thanks again
x

The 30K was just for opening. I have the cheshire set as clients and found they like danne, herzog, elemis, MD Formulations and darphin etc as skin care. Before you commit ask around and see what clients currently use. Are they over the counter products? Are the majority glycolic or aromatherapy based? What do the spend a month on skincare?

You have to add up staff costs, rent, phone, website maintenance and advertising, point of sale material inc leaflets, business cards, bags etc. Stock replenishment, servicing such as PAT testing, towel washing, cleaning of salon. Then theres any training you need to pay over the next 6 months. Add on to this rates, accountant fees, banking fees, electric, water and solicitor fees. When you have your average monthly rate for each, then I would keep a minimum of 3 - 6 months in the bank to ensure you survive. You will probably struggle the first month then break even after that.

Its good to set your self a target sheet for you and your staff. I take what I need to earn minimum a month on treatments then add 20% to cover replacement stock. Divide this per week so you have a weekly target to hit then divide it by the day. But do it as 100% for example saturday will be the busiest day but you may only do half the hours you do on a thursday. Mine is 12% Monday, 14% Tuesday, 18% wed, 22% Thur, 20% Fri & 14% Saturday of my target to attain.

I then divide this into therapists so for example if my monthly minimum target was £2000 but £500 a week then fridays target would be £100. This is then divided into therapists so each therapist must earn £50 each.

These figures I keep in the back room (I.E to myself!) I then create a target for month to include the minimum month target. I take into account the times of year I will be busier/quieter etc. I then set each therapist and myself these inflated targets to reach.

If reached the staff get a bonus. Providing you break even then thats brilliant but have those targets there to give you somnething to achieve! You should be in profit in no time!

Dont forget to add a constigency amount into this for new treatments you want to incorporate as well any unforseen circumstances.

And finally dont forget to add on to your targets the tax & vat costs as well as your own tax and NI.

And also if your playing music remember to get your licence, and dont forget to get all your equipment pat tested before opening and done every 12 months.

It took me 6 weeks to open my salon (i basically woke up one morning and thought sod it lol!). However I wish I knew what I know now cause I wasted over £10K in the first year on major mistakes!

Kate x