Advice on opening a salon

[OpalBeauty]

Hi all, apologies for the long one!
I am currently working in education 37 hours a week, bought a house last year and I have opened a beauty room within my house, I work as often as I can on Saturdays and Sundays, and weekday evenings. I earn a good wage in my daytime job but beauty is my absolute dream. I can't give up my daytime job yet as I have been working on some projects that come to fruition within the next 2 years which I really want to see through to the end, but would like to start on the opening of the salon now, so I have that push to leave my job, otherwise I will never leave!
I have completed a business plan and have planned into it to employ 4 therapists and a part time salon manager. I would like to work in the salon myself still at evenings and weekends (me as a 5th therapist) so my current clients have a salon to go to, and if a opening comes up within the salon, I will then work in the salon full time as a therapist. I will obviously still keep my salon manager.
I have done a couple of salon management courses, but I am still unsure of a couple of things, if anyone can give me some help or advice please, I would be so grateful.

- Business Loans - I have been looking at business loans, to either rent a property or buy one, can anyone recommend a good company to go through for these loans? I have had a look and put in some enquiries, but have had a lot of spam calls and I'm finding it difficult to find someone reputable. Could I also get a business loan to buy the property rather than rent?
- Wages breakdown for therapists - How are beauty therapists usually paid? I only know what I pay myself, but would you recommend an hourly wage, and then a % of all treatments that the therapist completes?

 

[salonfrog]

Hi all, apologies for the long one!
I am currently working in education 37 hours a week, bought a house last year and I have opened a beauty room within my house, I work as often as I can on Saturdays and Sundays, and weekday evenings. I earn a good wage in my daytime job but beauty is my absolute dream. I can't give up my daytime job yet as I have been working on some projects that come to fruition within the next 2 years which I really want to see through to the end, but would like to start on the opening of the salon now, so I have that push to leave my job, otherwise I will never leave!
I have completed a business plan and have planned into it to employ 4 therapists and a part time salon manager. I would like to work in the salon myself still at evenings and weekends (me as a 5th therapist) so my current clients have a salon to go to, and if a opening comes up within the salon, I will then work in the salon full time as a therapist. I will obviously still keep my salon manager.
I have done a couple of salon management courses, but I am still unsure of a couple of things, if anyone can give me some help or advice please, I would be so grateful.

- Business Loans - I have been looking at business loans, to either rent a property or buy one, can anyone recommend a good company to go through for these loans? I have had a look and put in some enquiries, but have had a lot of spam calls and I'm finding it difficult to find someone reputable. Could I also get a business loan to buy the property rather than rent?
- Wages breakdown for therapists - How are beauty therapists usually paid? I only know what I pay myself, but would you recommend an hourly wage, and then a % of all treatments that the therapist completes?

Hi

Exciting times! I'll PM you later this morning.

 

[skin&tonic]

Can I be cheeky and ask what salon management courses have you done and would you say they were worth it? Sorry this reply hasn't been any help to you

 

[daydreams01]

Speaking from experience I think you may be jumping the gun employing 4 therapists for a new business. Is it already an existing salon? If not, How do you plan to pay them when you are establishing the salon, clients take time to build up, it took me 18months to break even let alone take a wage for myself. I did the same as you and was teaching in FE when I first opened and managed 2 jobs for first 18months, then took redundancy so I could be there full time but at least by then I could pay myself a little bit. You need to keep your wages bill as low as poss to start with as you will have a million other things to pay out for and you don't want to be paying staff to sit around waiting for clients. Build up gradually. I'm 4 years in next week and I love it but it's really stressful being responsible for paying people's wages when your having a quiet week, on top of rent and utilities etc so my only advice is keep it small to start!

 

[RED STAR]

Completely echo the above advice.
I can hardly believe my naivety when i read my business plan back - five years on.
I had such big ideas...me and 2 full timers, an apprentice + a Saturday assistant. LOL.
Five years later, just me - full time, scratching a living ..... a Saturday stylist, and a wee shampoo girl.

Staff have come and gone...they lack drive, and expect a queue of clients to form around the block, without putting any effort into building a clientele themselves.

Business is tough.
Today's consumer is price savvy!
They are often looking for a deal....
They think they know more about hair & skin than a trained professional thanks to you tube.
And we are working in a saturated market.

Good staff are REALLY hard to find.
Most seem to want to do as you are doing, part time alongside a well paid 'proper job'!!

If I haven't put you off, go to your bank for a loan.
Keep any dept you take on MANAGEABLE.
Don't get carried away regarding luxury items - like a manager & receptionist.
These positions will not directly generate an income, so initially are an unnecessary expense/risk.

I would recommend you go in as the main therapist, and look to take on 1-2 part timers.
Then just see how it goes.
Good Luck.

 

[CFBS]

Excellent advice above.
Your appointment book needs to be full weeks ahead before you even think about getting one part timer!
Profits are very tight these days.
Never pay anyone to do something you can do yourself - that includes your marketing, the clients, cleaning, leaflet delivery and so on.

 

[OpalBeauty]

Hi

Exciting times! I'll PM you later this morning.

Thanks Salon Frog, I will reply to your PM, might not be tonight or tomorrow night as I have clients but as soon as I can I will reply. Thank you so much for your help!

 

[OpalBeauty]

Can I be cheeky and ask what salon management courses have you done and would you say they were worth it? Sorry this reply hasn't been any help to you

I did a course at college, which was really helpful. It was a practical course as well as written, so you could picture yourself in the salon. I have done another online with the Training Company (not sure if they exist anymore). I am looking at a refresher one through the Guild, I would just like an update on salon practice so I may go through them. It's a level 4.

Thanks

 

[OpalBeauty]

Speaking from experience I think you may be jumping the gun employing 4 therapists for a new business. Is it already an existing salon? If not, How do you plan to pay them when you are establishing the salon, clients take time to build up, it took me 18months to break even let alone take a wage for myself. I did the same as you and was teaching in FE when I first opened and managed 2 jobs for first 18months, then took redundancy so I could be there full time but at least by then I could pay myself a little bit. You need to keep your wages bill as low as poss to start with as you will have a million other things to pay out for and you don't want to be paying staff to sit around waiting for clients. Build up gradually. I'm 4 years in next week and I love it but it's really stressful being responsible for paying people's wages when your having a quiet week, on top of rent and utilities etc so my only advice is keep it small to start!

Hi Daydreams01. Thank you for your advice, it is really appreciated I have been looking at an existing salon, where the owner may be moving abroad due to her husbands job, and there are already 2therapists there, but room for 4 therapists. I was hoping to pay them in the interim out of the business loan money, although I know this isn't sustainable. I do really like your idea of keeping it small, and if I decide to open a brand new salon, rather than an existing one, I will start with a smaller number than 4. Do you have any ideas please about wage structures? I only know what I pay myself, but a beauty therapist was telling me once (whilst I was having a treatment) that she gets paid an hourly rate and then a % of each treatment price. I wasn't sure what a reasonable amount would be.

Thanks again for your help and advice I really appreciate it xx

 

[OpalBeauty]

Completely echo the above advice.
I can hardly believe my naivety when i read my business plan back - five years on.
I had such big ideas...me and 2 full timers, an apprentice + a Saturday assistant. LOL.
Five years later, just me - full time, scratching a living ..... a Saturday stylist, and a wee shampoo girl.

Staff have come and gone...they lack drive, and expect a queue of clients to form around the block, without putting any effort into building a clientele themselves.

Business is tough.
Today's consumer is price savvy!
They are often looking for a deal....
They think they know more about hair & skin than a trained professional thanks to you tube.
And we are working in a saturated market.

Good staff are REALLY hard to find.
Most seem to want to do as you are doing, part time alongside a well paid 'proper job'!!

If I haven't put you off, go to your bank for a loan.
Keep any dept you take on MANAGEABLE.
Don't get carried away regarding luxury items - like a manager & receptionist.
These positions will not directly generate an income, so initially are an unnecessary expense/risk.

I would recommend you go in as the main therapist, and look to take on 1-2 part timers.
Then just see how it goes.
Good Luck.

Hi Red Star thank you for your advice You haven't put me off yet as it's my dream, but I do think it has opened my eyes, and I certainly need to take a lot more into consideration than I was first expecting. It is my absolute passion to open a salon, and having my home salon just isn't sustainable anymore as we are running out of room, so wanted to branch out. Thank you for your help and advice xx

 

[OpalBeauty]

Excellent advice above.
Your appointment book needs to be full weeks ahead before you even think about getting one part timer!
Profits are very tight these days.
Never pay anyone to do something you can do yourself - that includes your marketing, the clients, cleaning, leaflet delivery and so on.

Hi CFBS, thank you for your help and advice xx

 

[daydreams01]

Hi Daydreams01. Thank you for your advice, it is really appreciated I have been looking at an existing salon, where the owner may be moving abroad due to her husbands job, and there are already 2therapists there, but room for 4 therapists. I was hoping to pay them in the interim out of the business loan money, although I know this isn't sustainable. I do really like your idea of keeping it small, and if I decide to open a brand new salon, rather than an existing one, I will start with a smaller number than 4. Do you have any ideas please about wage structures? I only know what I pay myself, but a beauty therapist was telling me once (whilst I was having a treatment) that she gets paid an hourly rate and then a % of each treatment price. I wasn't sure what a reasonable amount would be.

Thanks again for your help and advice I really appreciate it xx

I had one full timer with me from when I opened until recently and now have 1 partimer and another due to start this week job sharing but this has been very recent. What Inhave discovered from my accountant is 2 part timers are cheaper than a full timer plus give me more flexibility for hols etc. Reason being, I was due to put my previous full timer into the NEST govt. pension scheme as required by Law next month when my staging date occurs. Because my new part timers are under the earnings threshold so they only work half the hours, I don't need to enter them and also my employers NI contributions bill which I have every quarter will be much lower than before so that may be something for you to consider! I had no idea!
Regarding salary, not sure if beauty works the same but I pay a basic hourly rate according to age and experience and then commission once basic has been doubled or trebled plus retail. Think that's pretty standard for the industry.

 

[RED STAR]

Regarding the paying of staff, If you are taking over an existing business, I believe you will have to keep the staff on the wage structure they are on with the present employer, unless you make them redundant, which could be quite costly....
The current minimum wage for someone over 21 is £7.50.

Commission is a must if you want to get the best from your staff.

A rough guide;
Whatever they take over their basic wage (x 2-3)
Commission is paid on the remainder.


It is usual to set staged targets, possibly starting at 15%, then 20 % and so on.
Top stylists/therapists will expect more.

Remember you will have to pay holiday, a full timer is entitled to 20 days minimum + bank holidays (28 days), and you will also need to contribute to the new pension scheme.
Hope this helps

 

[squidgernetball]

I find it scary that this is a business proposition. If you have money to lose, go ahead but I would certainly advise caution. Have you looked at the accounts of this salon? Not only the turnover but the actual profit they're making? If you're starting out from scratch don't employ until you're busy enough to justify it. I would never think that opening a salon without being there full time is a good idea. One of the biggest problems in this industry is finding good reliable staff. You wouldn't believe the dross I've interviewed. I've even offered the job for it to be turned down before they've started. Everyone wants to work for themselves!

A business plan is just that. It's a piece of paper. The overheads of a salon are high and the overheads of wages and pensions are horrendous. Add sick pay and maternity and it's a nightmare.

I've now been in this business for over 16 years. 12 of them from a home salon where I could easily generate £150-200 per day. I've had my salon premises for about 4 years. I have over 1000 clients on my books and a turnover of over £150,000 and I have two full time staff and a part timer. Four staff is a major luxury I certainly can't afford.

I would also add that Joe Public is going somewhere for their treatments. Opening a salon doesn't guarantee clients. You have to make them want to come to you and virtually every other thread on here is "How can I get more clients". I often say I was never as rich as when I worked from home. That is the truth. Think long and hard before you take on a debt that may never be worth the risk.

I apologise if I sound harsh. People will say "You can do it if you want it enough" which you can, but small steps. What you're suggesting is a bloody large step with no safety net.

Good luck

Vic x

 

[BannerPenguin]

I find it scary that this is a business proposition. If you have money to lose, go ahead but I would certainly advise caution. Have you looked at the accounts of this salon? Not only the turnover but the actual profit they're making? If you're starting out from scratch don't employ until you're busy enough to justify it. I would never think that opening a salon without being there full time is a good idea. One of the biggest problems in this industry is finding good reliable staff. You wouldn't believe the dross I've interviewed. I've even offered the job for it to be turned down before they've started. Everyone wants to work for themselves!

A business plan is just that. It's a piece of paper. The overheads of a salon are high and the overheads of wages and pensions are horrendous. Add sick pay and maternity and it's a nightmare.

I've now been in this business for over 16 years. 12 of them from a home salon where I could easily generate £150-200 per day. I've had my salon premises for about 4 years. I have over 1000 clients on my books and a turnover of over £150,000 and I have two full time staff and a part timer. Four staff is a major luxury I certainly can't afford.

I would also add that Joe Public is going somewhere for their treatments. Opening a salon doesn't guarantee clients. You have to make them want to come to you and virtually every other thread on here is "How can I get more clients". I often say I was never as rich as when I worked from home. That is the truth. Think long and hard before you take on a debt that may never be worth the risk.

I apologise if I sound harsh. People will say "You can do it if you want it enough" which you can, but small steps. What you're suggesting is a bloody large step with no safety net.

Good luck

Vic x

Couldn't say it better myself. Personally, I don't tell anyone to get into this industry or open a salon unless you have a rather large pool of money to burn. This industry can easily haemorrhage cash if you wing it.

 

[GrahamJ]

I agree with one of the comments above. If you want to be successful in the early days then you have to work are your business full-time and then some. Building your clientele first and then passing off clients to an apprentice...rinse and repeat.