NAME BEAUTY SALON - Business Plan
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[NAME]
BEAUTY SALON
Business Plan
Contents
1.0Executive Summary.............................................................................................................................2
1.1Objectives..........................................................................................................................................2
1.2Keys to Success.................................................................................................................................2
2.0Company Summary.............................................................................................................................2
2.1Start-up Summary............................................................................................................................3
Chart: Start-up...................................................................................................................................3
Table: Start-up...................................................................................................................................3
2.2 Management...................................................................................................................................4
3.0Services & Products.............................................................................................................................5
4.0Industry Analysis Summary...............................................................................................................5
5.0Market & Location Analysis...............................................................................................................5
6.0 Strategy and Implementation............................................................................................................6
6.1 Competitive Edge...........................................................................................................................6
6.2 Marketing.........................................................................................................................................7
7.0Financials..............................................................................................................................................7
7.1Sales Forecast....................................................................................................................................8
7.2 Personnel Plan.................................................................................................................................8
7.3Start-up Funding..............................................................................................................................9
7.4Proft & Net Worth.........................................................................................................................13
7.5Projected Proft and Loss...............................................................................................................13
7.6Projected Cash Flow......................................................................................................................20
7.7Projected Balance Sheet.................................................................................................................27
pg. 2
1.0 Executive Summary
Our company will be a beauty salon offering a full range of services. Our goal is to
provide consistently extraordinary customer satisfaction by offering unequaled service
and top-quality products at reasonable prices in a relaxing, welcoming atmosphere.
That ambience will extend to our employees; we will nurture a supportive, fair work
environment, one which rewards diversity, creativity, and devotion to hard work.
The business’s founder holds that a person’s aesthetic appeal many times is the main
focus of his or her unique style, not merely a complementary facet of his or her lifestyle.
With the founder’s drive to one day establish a salon, and the obtaining of all the
necessary pieces to fulfill the dream, the sky’s the limit for this venture.
We will cater to both men and women, and provide many kinds of hair styling services
and products, all this in a soothing, yet businesslike, atmosphere. The demographics in
our chosen location of ________, as laid out in this business plan, show that there is
enough traffic, whether by car or on foot, in our target market segment to make it
possible for us to build up a walk-in clientele.
A one-of-a-kind blend of services, location, focus on our clients, and products all add up
to an advantage over our competition. The hiring of very experienced stylists and
beauticians will provide a quality of customer service never before achieved. All of our
customers will leave our premises confident in the knowledge that we have fulfilled their
wishes far above any of their prior expectations and well beyond anything our
competitors can provide. It is not just empty words; our business model, which focuses
on the customer, will be implemented so as to generate repeat business as well as
referrals.
Our salon will feature a highly talented team, including an expert cosmetologist,
providing a full range of services to present the clients in their best possible light. The
company's founder is noted for technical and business skills. We will provide a wide
variety of beauty services for hair, nails, and skin, as well as top-quality product lines of
beauty products. To stay one step ahead of our competition, we are committed to
conveniently providing everything consolidated under one roof, where our unmatched
stylists can provide our patrons with great service.
Key factors in the successful implementation of our business plan are our skills,
exceptional customer service, and the creation of a harmonious environment for our
customers.
pg. 3
Sales Forecast
Sales Forecast
250000
200000
150000
100000
50000
0
Year 1 Year 2 Year 3
pg. 4
1.1 Objectives
The objectives for our Salon are:
1.2 Keys to Success
pg. 52.0 Company Summary
Our intent is to open a full service salon that provides customers with first rate service
and products. The salon will be opened in _ (location) __. We will be devoted to
delivering beauty with great attention to detail. As a team we promise to understand how
important customers take their appearance.
Our mix of top-notch services, convenient location, and outstanding customer relations
provide us with a competitive advantage over our rivals. Reliable, superlative service
will result in our patrons coming to view us as the premier salon in the neighborhood.
The sheer breadth and variety of our services and products will set us apart from other
beauty salons. With prior experience of such a diversified type of salon, our founder and
the team we have selected to run the business are aware that offering all the services
and products in a single place will attract customers. Our patrons will be seeking an all-
in-one experience encompassing not only their hair, but also their nails and skin.
Although our salon’s main concern will be hair styling, we plan to make these other
services conveniently available in the same location.
pg. 6Our salon will:
We strive to cater to those clients for whom the most expensive salons are just out of
reach. In our hands, they will be able to relax and enjoy being pampered.
pg. 72.1 Start-up Summary
Chart: Start-up
Proft
67462
43997
38863
Year 1 Year 2 Year 3
Table: Start-up
Startup
Requirements
Startup Expenses
Website and Grand Opening $7,500
Flyers & Printng $200
Virtual terminal and payment gateway $500
Constructon/Design/Build-out $105,000
Rent $2,875
Expensed Equipment $1,000
Other $250
Total Startup Expenses $117,325
Startup Assets
Cash Required $10,000
Other Current Assets $0
Long-term Assets $0
Total Assets $10,000
Total Requirements $127,325
pg. 82.2 Management
On this page you will need to list the members of your management team along with
their bios.
pg. 93.0 Services & Products
Our Salon will offer a full array of services that include:
Hair Cuts Hair Extensions Hair Coloring Blow Dry
Keratin Treatments Products Nail Care Makeup
You will need to go ahead and add or subtract services and products to fit your specific
business.
4.0 Industry Analysis Summary
Companies in this industry operate hair salons and barbershops. Major companies
include Regis, Ratner Companies, and Sport Clips (all based in the US), as well as
CavinKare (India), Frisör Klier (Germany), Premier Salons (Canada), and Stefan Hair
Fashions (Australia). Regis also has salons in Canada and the UK.
The global hair care industry, including hair restoration as well as hair care services,
generates annual revenue of about $160 billion, according to Regis. Key sources of
growth include the rising middle classes in Brazil, Russia, India, and China (the BRIC
nations). Shifting cultural norms also drive demand.
Demand is partly driven by demographics and partly by population growth. The
profitability of individual companies depends on technical expertise and marketing skills.
Big companies have few advantages over small ones, which is why the industry
remains fragmented. Small companies can compete successfully through technical
superiority or favorable location. The industry is labor-intensive: average annual
revenue per employee is about $45,000.
Major products are hair cutting, hair coloring, nail care, skin care, and merchandise
sales. A typical salon offers haircutting and styling, coloring, shampooing, and
permanents. Some salons also offer nail care, facial treatments, makeup, bikini waxing,
massage, tanning, and other types of spa treatments, but the lower volume of demand
for such specialty services often makes them uneconomical. Sales of hair care products
are an important revenue source for many salons, providing from 5 to 15 percent of
revenue. Gross margins are higher for hair care products than for services. A typical
salon occupies about 1,000 to 1,500 square feet and is located in a mall or strip center.
pg. 105.0 Market & Location Analysis
In this section you will need to find and paste in data and information on the city, area,
etc… where your Salon will be located. A good starting point is to do an internet search
for the demographics of you city/location and you can paste what you find here.
pg. 116.0 Strategy and Implementation
Our strategy for success is uncomplicated: the best advertising is by word of mouth from happy
clients. When a customer receives a stunning makeover, he or she becomes a walking billboard
advertising the quality of our work. Referrals and advertising campaigns will be the source of
most of our new clients. We will reach out to the patrons of the most exclusive local boutiques,
clubs, resorts, spas, and restaurants, and of course rival salons.
The creative, innovative organization of the salon will lead to top-notch customer satisfaction,
and a working climate which lends itself to a great deal of personal improvement and financial
rewards for both employees and shareholders. Through regularly scheduled training classes,
our employees will be able to continually upgrade their skills and knowledge of our products.
6.1 Competitive Edge
Our competitive edge will be to:
• Keep the salon immaculate by carefully adhering to stringent cleaning practices. Make it clear
to customers that the salon watches out for their health by maintaining spotless conditions. Do
nothing that would raise the slightest concern about their well-being.
• Employ staff members who are friendly, yet professional, and fully aware that exceptional
customer service must be their goal.
• Continually update our staff on the latest in products and services, and coach them as to the
most effective ways to sell extras to the clientele. Cater to ever changing client tastes and inject
a touch of novelty by introducing new services or color palettes that match the season.
• Market the salon in an entertaining, attention-grabbing way so that it stands out from all the
rest. For example, exclusive product lines or services bundled together under witty, memorable
titles can significantly enhance the business’s financial bottom line and future. The constant
refreshment of window displays will pique the interest of our clientele and reassure them that we
are always on top of the latest styles.
• Small gifts or upgrades are tangible and effective loyalty rewards, as are coupons and prize
drawings for referrals.
pg. 126.2 Marketing
We will use offline traditional and online marketing strategies that include:
Advertising – using newspapers, magazines and other forms of media within our budget.
Using SMM: Facebook, Groupon, Living Social, and others to get the word out about
specials we will be offering.
Visible signs - and exterior displays will play an important role in our marketing.
Existing customer referrals – Once we have built a customer base we intend to utilize
them for referrals.
Yelp – we will have a computer set up in the Salon so that people can leave a Yelp
review before they leave.
Location of the Salon – We expect to garner customers that drive and walk by our
location.
Public Relations – PR will be heavily used as we believe it is one of the most cost
effective methods of marketing.
7.0Financials
7.1 Sales Forecast
pg. 13Sales Forecast
Year 1 Year 2 Year 3
Sales
Hair $151,500 $178,193 $222,741
Nails $59,100 $72,937 $91,171
Other Services $32,000 $39,306 $49,132
Products $16,750 $18,556 $23,195
Total Sales $259,350 $308,992 $386,239
Direct Cost of Sales Year 1 Year 2 Year 3
50% Commission to Stylist $75,000 $89,096 $111,371
Cost of Products $20,442 $25,549 $31,936
Subtotal Direct Cost of Sales $95,442 $114,645 $143,307
Funding
Funding
Capital 127325
Assets 10000
Expenses 117325
pg. 147.2 Personnel Plan
Personnel Plan
Year 1 Year 2 Year 3
Owner/President $35,000 $51,000 $65,000
Receptonist $18,000 $21,000 $22,000
Other Personnel $16,000 $17,000 $22,000
Total Payroll $69,000 $89,000 $109,000
7.3 Start-up Funding
Funding
Funding
Capital 127325
Assets 10000
Expenses 117325
pg. 15Startup Funding
Startup Expenses to Fund $117,325
Startup Assets to Fund $10,000
Total Funding Required $127,325
Assets
Non-cash Assets from Startup $0
Cash Requirements from Startup $10,000
Additonal Cash Raised $0
Total Assets $10,000
Liabilites and Capital
Liabilites
Current Borrowing $0
Long-term Liabilites $0
Other Current Liabilites $0
Total Liabilites $0
Capital
Planned Investment
Owner $127,325
Investor $0
Additonal Investment Requirement $0
Total Planned Investment $127,325
Loss at Startup (Startup Expenses) ($117,325)
Total Capital $10,000
Total Capital and Liabilites $10,000
Total Funding $127,325
pg. 167.4 Profit & Net Worth
Proft
67462
43997
38863
Year 1 Year 2 Year 3
pg. 177.5 Projected Profit and Loss
Pro Forma Proft and Loss
Year 1 Year 2 Year 3
Sales $259,350 $308,992 $386,239
Direct Cost of Sales $95,442 $114,645 $143,307
Other $0 $0 $0
Total Cost of Sales $95,442 $114,645 $143,307
Gross Margin $163,908 $194,347 $242,932
Gross Margin % 63.20% 62.90% 62.90%
Expenses
Payroll $69,000 $89,000 $109,000
Sales and Marketng $4,175 $5,500 $6,700
Depreciaton $0 $0 $0
Rent $34,500 $34,500 $34,500
Utlites $3,600 $4,000 $4,500
Insurance $1,200 $1,500 $1,750
Payroll Taxes $10,350 $13,350 $16,350
Internet & Cable $720 $750 $770
Other General and Administratve Exp $1,500 $1,750 $1,900
Total Operatng Expenses $125,045 $150,350 $175,470
Proft Before Interest and Taxes $38,863 $43,997 $67,462
EBITDA $38,863 $43,997 $67,462
Interest Expense $0 $0 $0
Taxes Incurred $0 $0 $0
Net Proft $38,863 $43,997 $67,462
Net Proft/Sales 14.98% 14.24% 17.47%
pg. 187.6 Projected Cash Flow
Pro Forma Cash Flow
Year 1 Year 2 Year 3
Cash Received
Cash from Operatons
Cash Sales $259,350 $308,992 $386,239
Subtotal Cash from Operatons $259,350 $308,992 $386,239
Additonal Cash Received
New Current Borrowing $0 $0 $0
New Other Liabilites (interest- $0 $0 $0
free)
New Long-term Liabilites $0 $0 $0
Sales of Other Current Assets $0 $0 $0
Sales of Long-term Assets $0 $0 $0
New Investment Received $0 $0 $0
Subtotal Cash Received $259,350 $308,992 $386,239
Expenditures Year 1 Year 2 Year 3
Expenditures from Operatons
Cash Spending $220,487 $264,995 $318,777
Subtotal Spent on Operatons $220,487 $264,995 $318,777
Additonal Cash Spent
Principal Repayment of Current $0 $0 $0
Borrowing
Other Liabilites Principal $0 $0 $0
Repayment
Long-term Liabilites Principal $0 $0 $0
Repayment
Purchase Other Current Assets $0 $0 $0
Purchase Long-term Assets $0 $0 $0
Dividends $0 $0 $0
Subtotal Cash Spent $220,487 $264,995 $318,777
Net Cash Flow $38,863 $43,997 $67,462
Cash Balance $48,863 $92,860 $160,322
pg. 197.7 Projected Balance Sheet
Pro Forma Balance
Sheet
Year 1 Year 2 Year 3
Assets
Current Assets
Cash $48,863 $92,860 $160,322
Other Current Assets $10,000 $10,000 $10,000
Total Current Assets $58,863 $102,860 $170,322
Long-term Assets
Long-term Assets $0 $0 $0
Accumulated $0 $0 $0
Depreciaton
Total Long-term Assets $0 $0 $0
Total Assets $58,863 $102,860 $170,322
Liabilites and Capital
Year 1 Year 2 Year 3
Current Liabilites
Current Borrowing $0 $0 $0
Other Current $0 $0 $0
Liabilites
Subtotal Current $0 $0 $0
Liabilites
Long-term Liabilites $0 $0 $0
Total Liabilites $0 $0 $0
Paid-in Capital $127,325 $127,325 $127,325
Retained Earnings ($117,325) ($78,462) ($34,465)
Earnings $38,863 $43,997 $67,462
Total Capital $48,863 $92,860 $160,322
Total Liabilites and $48,863 $92,860 $160,322
Capital
Net Worth $58,863 $102,860 $170,322
pg. 20i
Sources used for industry research:
http://www.frstresearch.com/industry-research/Hair-Care-Services.html
http://www.businesswire.com/news/home/20060418005013/en/Research-Markets-
Regis-Corp-Largest-Companies-Hair
pg. 21i For Further Information Please Contact:
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