How to start a Barbershop or Salon

by Joshua Botello

Starting your barbershop or salon seems like an easy proposition, especially if you've been in the industry for a few years. The barber and beauty industry is fairly regulated here in California and there are a bunch of hoops that you'll have to jump through to make your dream happen. In this guide, I'll give you a 5 step guide on how to start your barbershop or beauty salon. So let’s go...

Business Concept

The first thing you're going to need to figure out is what kind of services you're going to offer. Are you going to be offering straight haircuts or are there other services such as shaving or color that customers are going to want? You also have to determine whether or not you're going to be selling products such as hair care products or beard care in your location.

When it comes to customers you'll have to decide if you're going to serve strictly men or women or a mix of both. Each type of customer will have their own set of needs when it comes to hair care so you have to understand what those are. You can offer different kinds of products from larger manufacturers, but you'll just have to be trained on how to use them and get customers to purchase.

You need to understand what your customers are and what kind of atmosphere are they looking for. Is there a particular location or clientele that you're going to be catering to and you want to make that environment as comfortable as possible for those clients?

Costs & Revenue

Before you start, you need to figure out what's it going to cost to open up your shop. If you're looking to start your own shop there are some fixed costs like buildings, rent, and equipment you're going to have. Depending on what space you're looking to get into, the rent for the location may cost about $5,000 a month plus any refurbishments to make it a working salon. The minimum cost is somewhere from $15,000 to upwards of $50,000 depending on how much work is needed.

The other types of costs you going to need to figure out are going to be variable. This means these costs are going to fluctuate from month to month like wages utilities and supplies for your business. The better way to think about this is “the more the more customers you serve the more you going to be spending." So having a working business plan or financial budget will be really important at this stage.

Now let's talk about revenue. how much are you going to charge for your services? depending on how many services you were going to offer in our first step, you'll not have to price those. you can do some research around town and see what other shops are charging for similar services. You may be able to get away with charging more for offering higher-quality service or less if you can cut the cost of offering the same service.

Licenses and Permits

Let's get your establishment up and running, but before you can even think about opening up a barbershop you need to have your cosmetology license from the state of California. You can search online for cosmetology schools or local community colleges with cosmetology programs. To get your license, you will need to pass the cosmetology test and register with the California Department of Consumer Affairs Board of Barbering and Cosmetology.

Once you have your license you'll need to set up your business with the state. The biggest question I have seen online is how to set up your business can you be a sole proprietor, an LLC, or Corporation. We actually have guides on how to set up a Fictitious Business Name otherwise known as a DBA with the county your business will be in or Form an LLC with the Secretary of State of California.

Now it’s time to set up your establishment. You will need to find a location and file your entity formation before moving in. You can get help from your local SBDC, like our office here to help with those filings. Once you find a location you will need to apply for an “Establishment License” with the Board of Barbering and Cosmetology. This application asks for owner information, the location of the shop, how the business is set up, and the required signatures for owners.

Operations

Once you have your business started up, you will need some systems to make sure it runs smoothly. You will first need to keep track of the money the business makes. If you have a shop that uses a point of sale system, you can definitely go with Square which accommodates credit transactions and contactless payment options for your customers. You will also need an accounting system like QuickBooks to track revenue and expenses in the business. If you aren’t comfortable with doing your own accounting you hire a trusted bookkeeper or licensed CPA to remotely connect to your system to make sure your books are in order.

You will also need to set up some kind of booking system to make it simple for your customers to book appointments with a member of your staff. Programs like Rosy, Simple Salon, or Vagaro each have their features but you can schedule appointments, send reminders and connect them to your website or create your own simple booking site for your business. Booking apps are essential because not only can you track your customers and each of their preferences, but you can see what your customer traffic looks like and if your marketing efforts are working.

Marketing

Speaking of marketing, time to bring in customers. If you are just starting you make want to create a local awareness campaign with good old-fashioned mail. The post office has a tool called the Every Door Direct Mail or EDDM tool to target specific zip codes, neighborhoods, and streets that your target customer could be living on. You can check out my review of the tool and how it works in the card above.

The other channel most establishments are interested in is social media. Platforms like Facebook and Instagram are free viable options to get your already existing customers to follow your business and see any promotions or activities your business has. You can post before and after photos, stylist profiles, and even testimonial videos. If you are just starting on social media, check out our guides on setting up Facebook or Instagram for your business in the cards above.

Conclusion

Opening a new barbershop or salon is a lot of work with getting a state license and another one to open a shop. It’s just as intensive if you were to purchase an existing business but that’s for another video. The biggest takeaway is to have your business planned out and all of your systems for marketing and operations in place to be a success. You can always get help planning or managing your business with our free consulting here at the University of La Verne SBDC.

But what do you think? Are you a shop owner and was this something you wish you knew when you started? Do you have any questions of your own? Let me know down in the comments below.

Funded in part through a Cooperative Agreement with the U.S. Small Business Administration. All opinions, conclusions, and/or recommendations expressed herein are those of the author(s) and do not necessarily reflect the views of the SBA.