A Business Plan for

Salon Ownership
Cosmetology II
 Copyright
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 The Salon Business

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 Rent or Manage

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 Booth/Chair Rental

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 Renting a booth - Advantages
A cosmetologist:
• Becomes his or her own boss
• Is responsible for his or her own
• Accounting
• Clientele
• Record keeping
• Supplies
• Pays a weekly fee to salon owner
• Rents a work station in a salon
from a salon owner

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 Renting a Booth - Facts
A cosmetologist must: • Create professional materials
• Business cards
• Budget for advertising • Service menu
• Carry adequate insurance • Keep records for tax purposes
• Health
• Malpractice • Pay for continuing education
courses
• Collect all service fees
• Pay taxes, including Social
• Comply with all IRS obligations for Security
independent contractors
• Purchase all supplies
• Track and maintain inventory
• Use personal phone for bookings

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 Managing a Salon
Management opportunities:
• Assistant manager
• Department head
• Educator
• General manager
• Inventory manager
• Special events manager

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 Business Skills Needed
• Accounting
• Math
• Profit and loss statements
• Marketing
• Advertising
• Promotions
• Public relations

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 Factors to Consider

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 Decisions
• Business Name
• Location
• Easy access
• Good visibility
• Handicap access
• High traffic
• Sufficient parking
• Timeline
• Written agreements
• Employee and vendor contracts
• Lease

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 Types of Ownership

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 Salon Ownerships
1. Individual
• Sole proprietor
2. Partnership
3. Corporation
4. Franchise

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 Owning a Salon
• Brand identity
• Lease or rental agreement
• Insurance
• Fire
• Lawsuits
• Theft
• Operations

14
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 Business Records

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 Business Plan
Include:
1. Executive summary
2. Vision statement
3. Mission statement
4. Organizational plan
5. Marketing plan
6. Financial documents
7. Supporting documents
8. Salon policies

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 How to Write a Business Plan
(click on link)

(image from video)

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 Record Keeping
• Bookkeeping
• Income and expenses
• Business taxes
1. Local
2. State
3. Federal
• Inventory
• Service

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19 Copyright © Texas Education Agency, 2015. All rights reserved.
 1. Why study the business of salon
ownership?
2. What are the advantages and
disadvantages of a booth rental?
3. Does a management position interest you?
4. Why are business skills needed to operate a
salon?
5. Name three decisions to consider before
opening a salon.
6. Which type of salon ownership is the best
one?
7. What other factors do you need to consider
before you open a salon?
8. Is a business plan necessary?

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21 Copyright © Texas Education Agency, 2015. All rights reserved.
 References and Resources
Images:
• Shutterstock™ images. Photos obtained with subscription. (Slides 1, 3, 4, 5, 6, 8, 9, 10, 11,
12, 13, 14, 15, 16, 18, 19, 20, 21)
Textbook(s):
• Frangie, C. M. (2012). Milady standard cosmetology. Clifton Park, NY: Cengage Learning.
• Backe, J. (2016). Milady standard cosmetology. Clifton Park, NY: Cengage Learning.
Websites:
• Texas Department of Licensing and Regulations
The leader in public service, customer satisfaction, and innovation
http://www.tdlr.texas.gov/index.htm
YouTube™:
• How to Write a Business Plan
Interested in starting a business plan? Developing and maintaining your business plan is
like your roadmap to entrepreneurial success.
https://youtu.be/SMr_uLZV-eM

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