Table of Content

    Do you want to start barbershop business plan?

    Do you want to start a barbershop? Well, it might be an excellent idea if you are looking for a business that is simple but profitable. The biggest advantage of a barbershop is that it doesn’t require any official training or technical know-how. You can start your business at any time with ease.

    Even though this is a relatively simple business, you will still need to look at business plans for barber shops to make one of your own. If you want to learn how to make a business plan for a barber shop, you can either hire business plan writing services or learn from the format below. We will take you through everything you should include in your barber shop business plan step-by-step. So you can use this to even write soap manufacturer business plan.

    Executive Summary

    2.1 The Business

    Hank’s Barber Care will be a barbershop startup owned by Hank Peterson. The business will work to provide haircutting and salon services throughout Morristown. It will offer several services ranging from cutting, trimming, waxing, shaving, and hair color.

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    2.2 Management of the Barbershop

    To ensure that your startup is well-managed, you need to have a solid business plan strategy. And, to make that strategy, you need to be well versed in barbershop business plans.

    You can go about writing a barber shop start up business plan in two ways. Either learn how to write a business plan for a barber shop or go through a beauty supply store business plan or maybe a barber shop business plan example, like the one we are showing here.

    2.3 Customers of Barbershop

    Our customers will belong to almost every class of people, irrespective of their jobs or ethnicities. However, our potential and recurring customers are as follows:

    • Residential Community
    • Businessmen
    • Work Facilities
    • Job Hunters

    2.4 Business Target

    The main target of our business is to make sure that we provide satisfactory and reliable services to all of our customers whenever they need to freshen up their look.

    Our financial targets to meet for the first three years of our start are shown below:

    3 Years Profit Forecast - Barbershop Business Plan

    Franchise Business Plan
    Helps the franchisee get business case approval from the franchisor

    Company Summary

    3.1 Company Owner

    Hank Peterson will be the owner of Hank’s Barber Care. Hank completed his Bachelor’s a few years back. After his academic career, he worked at a managerial post for two years in a startup business firm. However, he left his job to fulfill his dream of opening a barbershop.

    3.2 Why the barbershop is being started

    Hank noticed a pattern of decline in traditional barber services around New Jersey. He observed that most places were focused more on looks than the comfort of customers. And so, he wanted to change the narrative by starting a stable barbershop with a good environment.

    3.3 How the barbershop will be started

    Step1: Plan Everything

    Before you figure out anything else, you need a business plan for a start up barber shop or a hair salon business plan. If you ask barber shop business plan experts, they will tell you that you require a business plan even if you just want to know how to start your own barbershop.

    So, now that you know that a barber shop business plan is a must, you need to learn how to do a business plan for a barber shop. For reference, you can take a look at the barber shop business plan template that we have presented here.

    Step2: Define the Brand

    Now that you have a basic plan, you need to highlight the value you provide to your customers. It is the time to brand your unique services to customers.

    Step3: Establish Your Corporate Office

    Hank decided to rent out a corner shop in Morristown to set up his barbershop. He will now buy all the tools and products needed, and he will also hold interviews to hire some barbers.

    Step4: Establish a Web Presence

    We live in an age where the internet is the best way to reach people. Hank decided to set up social media profiles for his business. He has also decided to have a website made where customers can book their appointments. It will give him an edge over other barbershops as people can easily schedule their trips and won’t need to wait in long lines.

    Step5: Promote and Market

    The last step is to make a marketing plan and promote your business.

    Startup Cost - Barbershop Business Plan

    Start-up Expenses  
    Legal $146,000
    Consultants $0
    Insurance $23,000
    Rent $33,000
    Research and Development $10,000
    Expensed Equipment $56,000
    Signs $3,400
    TOTAL START-UP EXPENSES $271,400
    Start-up Assets $266,000
    Cash Required $369,000
    Start-up Inventory $39,000
    Other Current Assets $240,000
    Long-term Assets $287,000
    TOTAL ASSETS $1,201,000
    Total Requirements $1,472,400
    START-UP FUNDING
    Start-up Expenses to Fund $271,400
    Start-up Assets to Fund $1,201,000
    TOTAL FUNDING REQUIRED $1,472,400
    Assets
    Non-cash Assets from Start-up $1,506,000
    Cash Requirements from Start-up $285,000
    Additional Cash Raised $50,000
    Cash Balance on Starting Date $35,000
    TOTAL ASSETS $1,876,000
    Liabilities and Capital
    Liabilities $18,000
    Current Borrowing $0
    Long-term Liabilities $0
    Accounts Payable (Outstanding Bills) $48,000
    Other Current Liabilities (interest-free) $0
    TOTAL LIABILITIES $66,000
    Capital
    Planned Investment $1,472,400
    Investor 1 $0
    Investor 2 $0
    Other $0
    Additional Investment Requirement $0
    TOTAL PLANNED INVESTMENT $1,472,400
    Loss at Start-up (Start-up Expenses) $337,600
    TOTAL CAPITAL $1,810,000
    TOTAL CAPITAL AND LIABILITIES $1,876,000
    Total Funding $1,472,400

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    Services

    Before you start learning how to start a barber business, you need to figure out the services you will be providing to your clients. Only then can you start a barbershop business plan.

    The business plan for a barbing salon will differ from the usual business plans. So, it’s a good idea to look at some samples of a barbershop business plan pdf. It is also good to go through other examples, such as cosmetics manufacturing business plan.

    As Hank’s idea was to provide as many essential services as possible in a single space, the barber shop business plan for his shop can be used as a reference for other businesses. You can also look at a barber shop business plan pdf online for a better idea. Some services to be provided by Hank’s Barber Care include:

    • Male Haircuts

    Hank’s Barber Care will specialize in all types of male haircuts and hairstyles. Our customers can use whatever hairstyle they want, and our barbers will fulfill their requests.

    • Head Massages and Conditioning Treatments

    Our customers can also avail themselves of our massaging and conditioning services. These services can help customers relax and leave their stress behind. It can also help with blood flow and hair growth.

    • Razor and Wet Shaving Service

    Straight razors are considered to be something of a specialty when it comes to barbers. And our customers can rest assured that they will find the same level of skill in our barbershop. They can expect hot lather, irritation-free shave with the sharpest stylings.

    • Beard Styling

    No matter what the shape or texture of your beard is, our barbers can take it and turn it into a work of art with just a few masterful strokes of the razor.

    Marketing Analysis of a Barbershop

    Note

    Opening up a barbershop requires much more work than it might seem. And one of the most important steps to opening a barber shop is market analysis. It allows you to find and understand your customer base.

    Your analysis should include both past and present trends in the market. It should also analyze cost requirements such as how much to open barber shop or what are the most critical considerations when starting a barbershop business. You can find more help in related plans such as eyelash extension business plan.

    Business Plan for Investors

    If you don’t understand market analysis and its components, you can refer to this barber shop business plan doc for help. In this document, we have researched and analyzed our business’s various market trends and target customer bases.

    5.1 Market Trends

    According to the Bureau of Labor Statistics, the Barber Shops Industry Group employed 738k people in 2019. It is also estimated that the job growth will increase by 5.55% in the next ten years. According to Forbes, barbering is also one of the fastest-growing professions in the US.

    The market share of the barber shop industry is currently 5 billion, and according to IBISWorld, the industry’s revenue is also expected to rise by 1.5%.

    5.2 Marketing Segmentation

    The potential customers of Pro Cleaning Services are divided into the following groups:

    Marketing Segmentation - Barbershop Business Plan

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    5.2.1 Residential Community

    Our main client base will be the nearby residents of Morristown. They are expected to avail of our services regularly. And they are also expected to utilize our more specialized services at least a few times a month. The presence of suburbs and family communities will help maintain a fresh flow of customers throughout each month.

    5.2.2 Business Folk

    Another vital part of our customer base will be people who don’t necessarily live in Morristown but are involved in businesses around the area. They are anticipated to use our specialized services more often as compared to the regular ones.

    5.2.3 Work Facilities

    Our third group of customers will be from the work facilities in and around Morristown. Workplaces are expected to use both our regular and special services, but their frequency of use is expected to be much less.

    5.2.4 Job Hunters

    Due to the fantastic job opportunities present around Morristown, we are also likely to get a steady flow of job hunter clientele. With our quick, neat, and affordable services, they will be able to look their best on their important days.

    Market Analysis
    Potential Customers Growth Year 1 Year 2 Year 3 Year 4 Year 5 CAGR
    Residential Community 32% 33,000 35,000 37,000 39,000 41,000 10.00%
    Business Folk 25% 30,000 31,000 34,000 35,000 37,000 10.00%
    Work Facilities 23% 24,000 26,000 29,000 30,000 32,000 10.00%
    Job Hunters 20% 16,000 18,000 20,000 21,000 23,000 11.00%
    Total 100% 103,000 110,000 120,000 125,000 133,000 10%

    5.3 Business Target

    • To be the most popular barber service throughout Morristown and nearby towns.
    • To steadily expand our services and add more salon-related specialties as time goes on.
    • To have a profit margin of around $30-35k per month by the end of the fourth year.
    • To acquire and maintain a customer satisfaction score above 95%.

    5.4 Product Pricing

    Our price range will be moderate and relatively less than those of our competitors. We aim to offer better customer service to our client base in an affordable price range.

    Marketing Strategy

    To gain traction in a competitive market, you will need a good barber shop marketing plan. Furthermore, you will also need to find enough competitive aspects to put you over the other barbershops in the area.

    You can do this through a free business plan for barber shop. And if you want to know how to open a barbershop, then this barber shop business plan is an excellent place for you to learn. We are describing all the necessary details you need to look for in your business. And we are also looking at some crucial factors that help increase the value of the shop, such as Competitive Analysis and Sales Strategy.

    6.1 Competitive Analysis

    • We have ways to ensure maximum customer satisfaction. We will ask them for feedback and regularly improve upon services to ensure that the customers are cared for.
    • Our clients will be able to book their appointments beforehand through our website. This way they won’t have to wait in long queues.
    • Our customers can also contact us at any time through the website or our social media platforms, and we will provide a prompt response.
    • We’ll implement environmentally friendly services by using eco-friendly, non-toxic, and biodegradable products.

    6.2 Sales Strategy

    • Our leading platforms for advertisements and branding will be Google ads and Social Media ads.
    • In the initial months of our shop, we will provide refreshing discounts.
    • We will also offer unique discounts for clients that want to avail a specialized service.

    6.3 Sales Monthly

    Sales Monthly - Barbershop Business Plan

    6.4 Sales Yearly

    Sales Yearly - Barbershop Business Plan

    6.5 Sales Forecast

    Unit Sales - Barbershop Business Plan

    Sales Forecast      
    Unit Sales Year 1 Year 2 Year 3
    Male Haircut 28,000 29,680 31,461
    Massages & Conditioning 25,000 26,500 28,090
    Razor & Wet Shaving 20,000 21,200 22,472
    Beard Styling 12,000 12,720 13,483
    TOTAL UNIT SALES 85,000 90,100 95,506
    Unit Prices Year 1 Year 2 Year 3
    Male Haircut $10.00 $11.60 $13.46
    Massages & Conditioning $12.00 $13.92 $16.15
    Razor & Wet Shaving $12.50 $14.50 $16.82
    Beard Styling $15.00 $17.40 $20.18
    Sales
    Male Haircut $280,000.00 $344,288.00 $423,336.52
    Massages & Conditioning $300,000.00 $368,880.00 $453,574.85
    Razor & Wet Shaving $250,000.00 $307,400.00 $377,979.04
    Beard Styling $180,000.00 $221,328.00 $272,144.91
    TOTAL SALES $1,010,000.00 $1,241,896.00 $1,527,035.32
    Direct Unit Costs Year 1 Year 2 Year 3
    Male Haircut $4.00 $4.40 $4.62
    Massages & Conditioning $5.00 $5.50 $5.78
    Razor & Wet Shaving $4.50 $4.95 $5.20
    Beard Styling $4.00 $4.40 $4.62
    Direct Cost of Sales
    Male Haircut $112,000.00 $130,592.00 $145,348.90
    Massages & Conditioning $125,000.00 $145,750.00 $162,219.75
    Razor & Wet Shaving $90,000.00 $104,940.00 $116,798.22
    Beard Styling $48,000.00 $55,968.00 $62,292.38
    Subtotal Direct Cost of Sales $375,000.00 $437,250.00 $486,659.25

    Personnel plan

    The success of any business is greatly dependent on the mannerisms and capability of the workers. Hank knew that his business depended even more on a competent workforce. That’s why in both his barber shop business proposal and in his business plans for a barber shop, he included a list of employees that will form his business.

    7.1 Company Staff

    • A Co-Manager/Partner to help with the overall operation
    • 4 Barbers for regular haircuts and services
    • 3 Dedicated Barbers for specialized services
    • 2 Full-time Cleaners
    • 1 Web Developer to manage the website
    • 1 Social Media Manager to handle the online presence
    • 2 Sales Executives to organize and promote sales
    • 1 Accountant
    • 1 Receptionist

    7.2 Average Salary of Employees

     Personnel Plan      
    Year 1 Year 2 Year 3
    Co Manager $30,000 $33,000 $36,300
    Barbers $92,000 $101,200 $111,320
    Specialized Barbers $90,000 $99,000 $108,900
    Cleaners $25,000 $27,500 $30,250
    Web Developer $15,000 $16,500 $18,150
    Social Media Manager $15,000 $16,500 $18,150
    Sales Executives $30,000 $33,000 $36,300
    Accountant $65,000 $71,500 $78,650
    Receptionist $15,000 $16,500 $18,150
    Total Salaries $377,000 $414,700 $456,170

    Financial Plan

    Profits do not measure the true success of a business. There are a lot of aspects that go into the whole conclusion. And one of the essential ingredients is financial analysis. It will include the start up costs of a barbershop and the running expenses.

    You will observe that just like this plan, every barber shop business plan or even reiki business plan will contain identification and in-depth analysis of your monthly and yearly expenditures. This way, you can figure out ways to reduce them to a reasonable and sustainable level.

    Here we’re providing the detailed financial plan made for Hank’s Barber Care Shop so that you can get an idea of the business finances.

    8.1 Important Assumptions

     General Assumptions      
    Year 1 Year 2 Year 3
    Plan Month 1 2 3
    Current Interest Rate 8.12% 8.20% 8.26%
    Long-term Interest Rate 8.40% 8.44% 8.47%
    Tax Rate 24.03% 24.21% 24.60%
    Other 0 0 0

    8.2 Break-even Analysis

     Break-Even Analysis  
    Monthly Units Break-even 5340
    Monthly Revenue Break-even $132,500
    Assumptions:
    Average Per-Unit Revenue $231.00
    Average Per-Unit Variable Cost $0.62
    Estimated Monthly Fixed Cost $163,800

    Break-even Analysis - Barbershop Business Plan

    8.3 Projected Profit and Loss

     Pro Forma Profit And Loss    
    Year 1 Year 2 Year 3
    Sales $1,010,000 $1,241,896 $1,527,035
    Direct Cost of Sales $375,000 $437,250 $486,659
    Other $0 $0 $0
    TOTAL COST OF SALES $375,000 $437,250 $486,659
    Gross Margin $635,000 $804,646 $1,040,376
    Gross Margin % 62.87% 64.79% 68.13%
    Expenses
    Payroll $377,000 $414,700 $456,170
    Sales and Marketing and Other Expenses $145,000 $148,000 $156,000
    Depreciation $2,300 $2,350 $2,500
    Leased Equipment $0 $0 $0
    Utilities $2,900 $3,000 $3,100
    Insurance $2,100 $2,100 $2,100
    Rent $2,900 $3,000 $3,200
    Payroll Taxes $24,000 $25,000 $27,000
    Other $0 $0 $0
    Total Operating Expenses $556,200 $598,150 $650,070
    Profit Before Interest and Taxes $78,800 $206,496 $390,306
    EBITDA $78,800 $206,496 $390,306
    Interest Expense $0 $0 $0
    Taxes Incurred $15,760 $41,299 $78,061
    Net Profit $63,040 $165,197 $312,245
    Net Profit/Sales 6.24% 13.30% 20.45%

    8.3.1 Profit Monthly

    Profit Monthly - Barbershop Business Plan

    8.3.2 Profit Yearly

    Profit Yearly - Barbershop Business Plan

    8.3.3 Gross Margin Monthly

    Gross Margin Monthly - Barbershop Business Plan

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    8.3.4 Gross Margin Yearly

    Gross Margin Yearly - Barbershop Business Plan

    8.4 Projected Cash Flow

    Projected Cash Flow - Barbershop Business Plan

     Pro Forma Cash Flow      
    Cash Received Year 1 Year 2 Year 3
    Cash from Operations
    Cash Sales $51,000 $55,080 $59,486
    Cash from Receivables $22,000 $23,760 $25,661
    SUBTOTAL CASH FROM OPERATIONS $73,000 $79,570 $85,936
    Additional Cash Received
    Sales Tax, VAT, HST/GST Received $0 $0 $0
    New Current Borrowing $0 $0 $0
    New Other Liabilities (interest-free) $0 $0 $0
    New Long-term Liabilities $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 $74,000 $79,000 $85,000
    Expenditures Year 1 Year 2 Year 3
    Expenditures from Operations
    Cash Spending $42,000 $42,000 $45,000
    Bill Payments $27,000 $28,000 $31,000
    SUBTOTAL SPENT ON OPERATIONS $69,000 $70,000 $76,000
    Additional Cash Spent
    Sales Tax, VAT, HST/GST Paid Out $0 $0 $0
    Principal Repayment of Current Borrowing $0 $0 $0
    Other Liabilities Principal Repayment $0 $0 $0
    Long-term Liabilities Principal Repayment $0 $0 $0
    Purchase Other Current Assets $0 $0 $0
    Purchase Long-term Assets $0 $0 $0
    Dividends $0 $0 $0
    SUBTOTAL CASH SPENT $69,000 $74,520 $80,482
    Net Cash Flow $21,000 $23,000 $25,000
    Cash Balance $27,000 $30,000 $33,000

    8.5 Projected Balance Sheet

     Pro Forma Balance Sheet    
    Assets Year 1 Year 2 Year 3
    Current Assets
    Cash $275,000 $308,000 $338,800
    Accounts Receivable $24,000 $26,880 $30,213
    Inventory $4,300 $4,816 $4,900
    Other Current Assets $1,000 $1,000 $1,000
    TOTAL CURRENT ASSETS $282,000 $315,840 $355,004
    Long-term Assets
    Long-term Assets $10,000 $10,000 $10,000
    Accumulated Depreciation $19,400 $21,728 $24,444
    TOTAL LONG-TERM ASSETS $24,400 $27,328 $30,744
    TOTAL ASSETS $294,000 $329,280 $370,440
    Liabilities and Capital Year 4 Year 5 Year 6
    Current Liabilities
    Accounts Payable $18,700 $20,944 $23,541
    Current Borrowing $0 $0 $0
    Other Current Liabilities $0 $0 $0
    SUBTOTAL CURRENT LIABILITIES $19,000 $21,280 $23,919
    Long-term Liabilities $0 $0 $0
    TOTAL LIABILITIES $15,000 $16,800 $18,883
    Paid-in Capital $30,000 $30,000 $31,000
    Retained Earnings $53,000 $57,770 $63,547
    Earnings $193,400 $210,806 $231,887
    TOTAL CAPITAL $285,000 $310,650 $341,715
    TOTAL LIABILITIES AND CAPITAL $300,000 $329,280 $370,440
    Net Worth $293,400 $319,806 $351,787

    8.6 Business Ratios

     Ratio Analysis        
    Year 1 Year 2 Year 3 INDUSTRY PROFILE
    Sales Growth 7.25% 8.03% 8.90% 3.00%
    Percent of Total Assets
    Accounts Receivable 9.21% 10.20% 11.31% 9.80%
    Inventory 5.39% 5.97% 6.62% 9.90%
    Other Current Assets 2.11% 2.34% 2.59% 2.40%
    Total Current Assets 149.80% 151.00% 152.00% 158.00%
    Long-term Assets 11.55% 11.60% 11.64% 12.00%
    TOTAL ASSETS 100.00% 100.00% 100.00% 100.00%
    Current Liabilities 4.90% 4.94% 4.98% 4.34%
    Long-term Liabilities 0.00% 0.00% 0.00% 0.00%
    Total Liabilities 7.59% 7.65% 7.72% 7.38%
    NET WORTH 100.45% 101.25% 102.19% 110.00%
    Percent of Sales
    Sales 100.00% 100.00% 100.00% 100.00%
    Gross Margin 94.60% 97.15% 99.87% 99.00%
    Selling, General & Administrative Expenses 93.56% 96.09% 98.78% 97.80%
    Advertising Expenses 1.52% 1.56% 1.60% 1.40%
    Profit Before Interest and Taxes 41.50% 42.62% 43.81% 33.90%
    Main Ratios
    Current 34 35 36 32
    Quick 33 33.8 34.645 33
    Total Debt to Total Assets 0.18% 0.18% 0.17% 0.40%
    Pre-tax Return on Net Worth 74.08% 74.89% 75.00% 75.00%
    Pre-tax Return on Assets 96.30% 101.12% 106.17% 111.30%
    Additional Ratios Year 1 Year 2 Year 3
    Net Profit Margin 33.56% 34.60% 35.67% N.A.
    Return on Equity 55.80% 57.53% 59.31% N.A.
    Activity Ratios
    Accounts Receivable Turnover 7.7 7.8 7.8 N.A.
    Collection Days 100 100 100 N.A.
    Inventory Turnover 32.4 34.02 35 N.A.
    Accounts Payable Turnover 15.6 16 16.3 N.A.
    Payment Days 27 27 27 N.A.
    Total Asset Turnover 2.5 2.5 2.6 N.A.
    Debt Ratios
    Debt to Net Worth -0.04 -0.03 -0.04 N.A.
    Current Liab. to Liab. 1 1 1 N.A.
    Liquidity Ratios
    Net Working Capital $244,000 $257,664 $272,093 N.A.
    Interest Coverage 0 0 0 N.A.
    Additional Ratios
    Assets to Sales 0.85 0.87 0.89 N.A.
    Current Debt/Total Assets 1% 0% 0% N.A.
    Acid Test 29 29.12 29.16 N.A.
    Sales/Net Worth 2.1 2.2 2.2 N.A.
    Dividend Payout 0 0 0 N.A.

    FAQ

    1. How do you write a business plan for a barbershop?

    You can use the above mentioned business plan barber shop template to get a decent idea for what a business plan barbershop should contain.

    1. How much money does it take to start a barbershop?

    The cost incurred while starting a barber shop business plan depends on a lot of factors such as location, number of services, and scale of your business. But relatively, a barbershop is one of the easier businesses to start.

    1. How do you attract customers to your barbershop?

    The best way to attract customers is to give unique and quality services so that every customer leaves your shop satisfied.

    1. How do you start a barber shop?

    The first step to starting any business is to plan. And you can do this through barber shop business plans. You can refer to the sample business plan for barber shop here.

    Download Barber Shop Business Plan Sample in pdf