Hair Salon business plan for starting your own business

A hair salon is a business that never goes into loss. As long as the people are living on earth, they will need to go to hair salons and get their hair done. If you plan to start your own hair salon business, you need a business plan hair salon. The first and crucial thing is to get an idea of how the business work and what do you need to start it. You need to set up a hair salon business consultants that provides all services, and high customer satisfaction by providing excellent services.

To start a hair salon that provides an amazing atmosphere at an affordable price-value relationship, you need a business consultant service.  If you do not know how to write a hair salon business plan, we have provided a detailed business plan to start a hair salon so that you can avoid any inconvenience in making a plan for yourself. You will find many samples of a business plan for a hair salon, but you need to choose the one that suits you the best.

Also, if you’re looking for a business plan for a barber shop, a business plan for hair extensions shop, a hair removal business plan, an airbrush tanning business plan, salon and spa business plan, or even a center reiki business plan, this template can help you!

Executive Summary

2.1 The Business

The Cute Cut Hair Salon will be registered in New York, USA. The business will offer the services that will enhance our customers’ appearance and their mental relaxation. Instead of competing with other hair salons in town, we mainly focus on providing services to the customers who cannot afford those luxury salons.

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2.2 Management of Hair salon

Cute Cut Hair Salon will be managed by Mike himself. To assist him, we will have three managers who will be trained for a month and a half before starting their jobs. In starting hair salon business plan, Mike will work with a small team comprising of a few hairstylists, managers, accountants, helpers and a guard. He will ensure the quality of work regularly.

2.3 Customers of Hair Salon

Customers are the backbone of every business. If you know the right audience for your business, you will be able to achieve your target. You will get the idea of how to run your business if you understand your customers. The main customers for the hair salon business consultants will be the following:

  • Women and men who are looking for hair treatments.
  • Children of age 15 and above.

Our best business plan for a hair salon includes all the hair removal treatments we mainly offer to women.

2.4 Business Target

In our business plan for hair salon pdf, we have mentioned our main goal. Our main goal is to provide high-quality services to our customers by using safe and good quality products. Our primary target is to become the popular and most loved hair salon by people within the next 3 years of our launch. We aim to recover the investment within the next two years. Our secondary target is to increase the net profit every month.

Hair Salon Bussines Plan - 3 Years Profit Forecast
Franchise Business Planning 
Helps the franchisee get business case approval from the franchisor

Company Summary

3.1 Company Owner

The owner of the Cute Cut Hair Salon will be Mike James. Mike had a dream of starting his own business since he was a teenager. He wanted to set up a business that helps people of all ages.

3.2 Why the Hair Salon is being started?

When Mike was asked why he is interested in starting a hair salon business plan, he said he wanted to help people who cannot afford expensive hair treatments. Moreover, his idea of setting up a hair salon business plan is based on the fact that this kind of business never goes into loss. He believes that his business can attract more customers because his salon uses all the new techniques and equipment. With constant hard work, he can now start his hair salon and fulfil his dream.

3.3 How the Hair Salon will be started?

To start a hair salon business plan, you need the right techniques and ideas. Before starting a hair salon, you need to consider these essential steps:

Know About Industry Experience

Before entering into the world of entrepreneurship, gain some experience in the relevant industry. For example, before starting your salon, it is preferred to work in some salons. If you get your feet wet by working in other salons, you will get enough experience of how things work.

It will allow you to see how the business work daily.

Create A Business Plan

A business plan helps in planning everything for a business. It will tell you how you will earn money, what type of customers your business is trying to attract, how are you going to manage the expenses and finances, and other daily operations.


The business plan will also help you to make important decisions that will affect your business.

Set Your Budget

To get an idea of the kind of salon you want to start, you will have to set up your budget first. First, get set with your expenses and finances as hair salons expenses can vary. They depend on the location and size of your business. For example, if you are setting up a salon in your home, you will have to bear fewer expenses. But if you want to start a hair salon in a commercial area, you may end up spending thousands.

Target Customers

Determining your target customer is a vital step in starting a business. Many business decisions depend on the type of clients you want to attract. Before finalizing anything, research the area you are planning to open a salon. If that area has plenty of people who want affordable yet modern hair solutions, set up your salon accordingly.

Business Plan for Hair Salon Template

Find A Suitable Location

Depending on the type of business and services you are providing, find a suitable location for your hair salon. Find a location that is centrally located, and it should also be easy for your target clients to access.

Obtain Permits

Once you have decided on the location for your salon, you will need to get a building permit, business permit, and all other legal documents.

Stock The Inventory

To run your business, you will at least need chairs, washing stations, hair tools, and other styling products. You can also connect with brands that will attract your target customers to offer their types of equipment at your hair salon.

Hire a Team

Depending on the size of your business, hire a team accordingly. It should have at least two hairstylists who can entertain the customers. The stylists should have a friendly nature and they should be experienced as well.

Hair Salon Bussines Plan - Startup Cost
Start-up Expenses 
Research and Development$23,000
Expensed Equipment$56,000
Start-up Assets$320,000
Cash Required$340,000
Start-up Inventory$50,000
Other Current Assets$213,000
Long-term Assets$230,100
TOTAL ASSETS$1,153,100
Total Requirements$1,542,100
Start-up Expenses to Fund$389,000
Start-up Assets to Fund$1,153,100
Non-cash Assets from Start-up$1,523,100
Cash Requirements from Start-up$373,000
Additional Cash Raised$54,000
Cash Balance on Starting Date$32,000
TOTAL ASSETS$1,982,100
Liabilities and Capital 
Current Borrowing$0
Long-term Liabilities$0
Accounts Payable (Outstanding Bills)$43,000
Other Current Liabilities (interest-free)$0
Planned Investment$1,542,100
Investor 1$0
Investor 2$0
Additional Investment Requirement$0
Loss at Start-up (Start-up Expenses)$369,000
Total Funding$1,542,100
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    To open a hair salon, you need to decide which hair services you are going to offer. The services that you plan to offer also depend on the size of your salon, and the equipment that you have. It will also determine how many hairstylists you need and the number of chairs you want in the salon.

    There are several services that a hair salon offers. You need to narrow down the services you are going to focus on. This business plan for hair salon will give you a detail about the services.

    Our services include the following:

    Hair Styling & Haircuts

    The basic service that Cute Cut hair salon is providing is hair cutting and styling. Some hairstylists can cut all types of hair for all men, women, and children. After cutting hair, drying it, and styling it is also offered in our hair salon.

    Hair Coloring

    Hair coloring is another service offered at Cute Cut hair salon. Before coloring the customer’s hair, our stylist discusses all the risks with the customer because coloring can sometimes go wrong.

    Hair Extensions

    Over recent years, the trend of hair extensions has gained popularity among people. As long hair is in fashion again, and more people are attracted to hair extension treatments. Stylists at Cute Cut Hair Salon are well-trained and experienced in hair extensions treatments.

    Conditioning Treatments

    These include deep conditioning treatments. The basic conditioning treatment is done to provide moisture to the hair. It adds protein to hair and makes them shiny and smooth.

    The other one is specialty conditioning that is customized according to the customer’s hair.

    Marketing Analysis of Hair Salon

    Marc Jacobs

    Great service

    Great service. Good turnaround time and quality work. Thanks!

    ∙ Marc Jacobs

    To make your hair salon business consultants successful, you need to keep an eye on the market trends as well. If you run a complete analysis of the market, you will get an idea about many things. Understanding the trends and variables will help you in making decisions for your business. The goal of this market research is to understand and get a general idea of the overall market around your salon and how you can adjust to that ecosystem.

    5.1 Market Trends

    Over the past five years, the hair salon industry has grown at an incredible rate. People are now more attracted to advanced hair treatments such as permanent hair, facial and massage etc. The hair salon market in 2019 was $144.48 billion. And by the end of 2026, the market is expected to grow by around $217.25 Billion.

    5.2 Marketing Segmentation

    If you know exactly what type of business is a hair salon, you can easily understand its market segmentation. There are many business plan examples for hair salon and each of them includes market analysis of hair salon.  To estimate the startup cost for hair salon, you need to make a complete analysis of market segmentation for it.

    The most important part of any hair salon business plan is to have an idea of the expected marketing segmentation. Here is the market segmentation that will be facing our hair salon:

    Hair Salon Bussines Plan - Marketing Segmentation

    UK Start-Up Visa Business Plan

    5.2.1 Women

    80 percent of our services will be offered to women who are interested in hair cutting and treatments. Cute Cut Hair Salon also offers skincare and nail care treatments to its customers.

    5.2.2 Men

    Some of our services are for men as well. We have hair stylists who are experienced in cutting men’s hair.

    5.2.3 Children

    We have a friendly staff who treat children with great care and affection. We offer haircutting for children.

    Market Analysis       
    Potential CustomersGrowthYear 1Year 2Year 3Year 4Year 5CAGR

    5.3 Business Target

    • Building a trustworthy relationship among customers
    • Providing high-quality services to customers
    • Arranging the best interior to impress the customers
    • Making an excellent customer care service for our loyal customers
    • Recovering the initial investment within two years of launch
    • Increase the revenue every year

    5.4 Product Pricing

    The prices of the services that a Cute Cut Hair Salon provide are comparable to other salon services. We will try to provide better services and customer care to our clients. We will satisfy our customers by providing exceptional services to make as much profit as possible.

    Marketing Strategy

    In any hair salon business plan template, the financial plan for hair salon should be well-formed. No business can grow and become successful without a marketing strategy. No matter how many excellent services you offer, if you do not have customers, it is all in vain. The more people know about your salon, the more they reach out to you.

    Nowadays, the best way of marketing is social media marketing. Social platforms are strong, and they are accessible to everyone. A good thing about social media marketing is its low cost. You can reach out to millions of people with online marketing. All the hair salon business models explains the importance of social media marketing and how you can use them to reach out to people. Along with that, you need a competitive analysis to make a strategy that will make your business successful.

    6.1 Competitive Analysis

    • People are not satisfied with the services provided by hair salons in that area.
    • The hair salons and spas in that area are too costly. And these services are not good enough as compared to their price.
    • Most salons do not offer basic services to people.
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    6.2 Our Strategy

    • We will associate our hair salon with community events and charity.
    • We will use social media platforms to advertise our hair salon.
    • We will make our online presence so that we can reach out to more and more people.
    • We will use the advertisements channels in the area to reach out to the people.

    6.3 Sales Monthly

    Hair Salon Bussines Plan - Sales Monthly

    6.4 Sales Yearly

    Hair Salon Bussines Plan - Sales Yearly

    6.5 Sales Forecast

    Hair Salon Bussines Plan - Unit Sales
    Sales Forecast   
    Unit SalesYear 1Year 2Year 3
    Hair Styling & Haircuts60,00063,60067,416
    Hair Coloring51,00054,06057,304
    Hair Extensions30,00031,80033,708
    Conditioning Treatments45,00047,70050,562
    TOTAL UNIT SALES186,000197,160208,990
    Unit PricesYear 1Year 2Year 3
    Hair Styling & Haircuts$45.00$52.20$60.55
    Hair Coloring$51.00$59.16$68.63
    Hair Extensions$60.00$69.60$80.74
    Conditioning Treatments$65.00$75.40$87.46
    Hair Styling & Haircuts$2,700,000.00 $3,319,920.00 $4,082,173.63
    Hair Coloring$2,601,000.00 $3,198,189.60 $3,932,493.93
    Hair Extensions$1,800,000.00 $2,213,280.00 $2,721,449.09
    Conditioning Treatments$2,925,000.00 $3,596,580.00 $4,422,354.77
    TOTAL SALES$10,026,000.00 $12,327,969.60 $15,158,471.42
    Direct Unit CostsYear 1Year 2Year 3
    Hair Styling & Haircuts$43.00$49.00$57.00
    Hair Coloring$49.00$56.00$65.00
    Hair Extensions$58.00$66.00$77.00
    Conditioning Treatments$63.00$72.00$84.00
    Direct Cost of Sales   
    Hair Styling & Haircuts$2,580,000.00 $3,116,400.00 $3,842,712.00
    Hair Coloring$2,499,000.00 $3,027,360.00 $3,724,734.00
    Hair Extensions$1,740,000.00 $2,098,800.00 $2,595,516.00
    Conditioning Treatments$2,835,000.00 $3,434,400.00 $4,247,208.00
    Subtotal Direct Cost of Sales$9,654,000.00 $11,676,960.00 $14,410,170.00

    Personnel plan

    When you are starting a hair salon business plan, you need to make sure that the staff should work as a team. In the hair salon business consultants examples, you will find out that the environment of the hair salon depends on the number and type of staff which should be determined in the initial stages.

    To start a hair salon business plan, list down all the expenses. It includes the rent of hair salon building, the cost of equipment and the employee’s salary.

    7.1 Company Staff

    Mike James will be the owner and CEO of the Cute Cut Hair Salon business plan. His team would include:

    • 1 Manager
    • 1 Social Media Marketer
    • 3 Hairstylists
    • 2 Helpers
    • 1 Accountant

    7.2 Average Salary of Employees

    Personnel Plan   
     Year 1Year 2Year 3
    Social Media Marketer$10,000$11,000$12,100
    Total Salaries$88,000 $96,800 $106,480

    Financial Plan

    Proper planning and execution of the finance help you to maintain a stable budget for the upcoming entire year. To start a hair salon, you need to make research on how much does it cost to open a hair salon. To run a smooth and successful hair salon, you should have a strong hair salon financial plan.

    • Money is needed to make the interior of the salon.
    • The cost of chairs, mirrors, and hair styling tools.
    • The salary of employees.
    • The cost of buying hair products.
    • Bonds, securities, registration costs, and insurance.

    8.1 Important Assumptions

    General Assumptions   
     Year 1Year 2Year 3
    Plan Month123
    Current Interest Rate8.12%8.15%8.22%
    Long-term Interest Rate8.31%8.36%8.41%
    Tax Rate23.77%24.02%24.12%

    8.2 Break-even Analysis

    Hair Salon Bussines Plan - Break-even Analesis
    Break-Even Analysis 
    Monthly Units Break-even5343
    Monthly Revenue Break-even$133,500
    Average Per-Unit Revenue$237.00
    Average Per-Unit Variable Cost$0.67
    Estimated Monthly Fixed Cost$161,900

    8.3 Projected Profit and Loss

    Pro Forma Profit And Loss   
     Year 1Year 2Year 3
    Sales$10,026,000 $12,327,970 $15,158,471
    Direct Cost of Sales$9,654,000 $11,676,960 $14,410,170
    TOTAL COST OF SALES$9,654,000 $11,676,960 $14,410,170
    Gross Margin$372,000 $651,010 $748,301
    Gross Margin %3.71%5.28%4.94%
    Sales and Marketing and Other Expenses$120,000$124,000$128,000
    Leased Equipment$0$0$0
    Payroll Taxes$32,000$33,000$34,000
    Total Operating Expenses$250,620 $264,600 $279,480
    Profit Before Interest and Taxes$121,380$386,410$468,821
    Interest Expense$0$0$0
    Taxes Incurred$24,276$77,282$93,764
    Net Profit$97,104$309,128$375,057
    Net Profit/Sales0.97%2.51%2.47%
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    8.3.1 Profit Monthly

    Hair Salon Bussines Plan - Profit Monthly

    8.3.2 Profit Yearly

    Hair Salon Bussines Plan - Profit Yearly

    8.3.3 Gross Margin Monthly

    Hair Salon Bussines Plan - Gross Margin Monthly

    8.3.4 Gross Margin Yearly

    8.4 Projected Cash Flow

    Hair Salon Bussines Plan - Project Cash Flow
    Pro Forma Cash Flow   
    Cash ReceivedYear 1Year 2Year 3
    Cash from Operations   
    Cash Sales$57,000$61,560$66,485
    Cash from Receivables$19,000$20,520$22,162
    SUBTOTAL CASH FROM OPERATIONS$76,000 $82,840 $89,467
    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$76,000 $83,000 $90,000
    ExpendituresYear 1Year 2Year 3
    Expenditures from Operations   
    Cash Spending$36,000$39,000$41,000
    Bill Payments$21,000$22,000$23,000
    SUBTOTAL SPENT ON OPERATIONS$57,000 $61,000 $64,000
    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
    SUBTOTAL CASH SPENT$57,000 $61,560 $66,485
    Net Cash Flow$16,000$17,000$18,000
    Cash Balance$28,000$29,000$31,000

    8.5  Projected Balance Sheet

    Pro Forma Balance Sheet   
    AssetsYear 1Year 2Year 3
    Current Assets   
    Accounts Receivable$24,000$26,880$30,213
    Other Current Assets$1,000$1,000$1,000
    TOTAL CURRENT ASSETS$293,000 $328,160 $368,852
    Long-term Assets   
    Long-term Assets$10,000$10,000$10,000
    Accumulated Depreciation$21,000$23,520$26,460
    TOTAL LONG-TERM ASSETS$22,000 $24,640 $27,720
    TOTAL ASSETS$295,000 $330,400 $371,700
    Liabilities and CapitalYear 4Year 5Year 6
    Current Liabilities   
    Accounts Payable$19,000$21,280$23,919
    Current Borrowing$0$0$0
    Other Current Liabilities$0$0$0
    SUBTOTAL CURRENT LIABILITIES$14,000 $15,680 $17,624
    Long-term Liabilities$0$0$0
    TOTAL LIABILITIES$13,400 $15,008 $16,869
    Paid-in Capital$31,000$32,000$33,000
    Retained Earnings$56,000$61,040$67,144
    TOTAL CAPITAL$273,000 $297,570 $327,327
    TOTAL LIABILITIES AND CAPITAL$286,400 $330,400 $371,700
    Net Worth$271,000$295,390$324,929

    8.6  Business Ratios

    Ratio Analysis    
     Year 1Year 2Year 3INDUSTRY PROFILE
    Sales Growth7.05%7.81%8.66%3.00%
    Percent of Total Assets    
    Accounts Receivable9.17%10.16%11.26%9.80%
    Other Current Assets2.05%2.27%2.52%2.40%
    Total Current Assets150.00%151.00%152.00%158.00%
    Long-term Assets11.76%11.85%11.91%12.00%
    TOTAL ASSETS100.00%100.00%100.00%100.00%
    Current Liabilities4.61%4.65%4.69%4.34%
    Long-term Liabilities0.00%0.00%0.00%0.00%
    Total Liabilities7.35%7.41%7.48%7.38%
    NET WORTH100.25%101.05%101.98%110.00%
    Percent of Sales    
    Gross Margin93.77%96.30%99.00%99.00%
    Selling, General & Administrative Expenses92.30%94.79%97.45%97.80%
    Advertising Expenses1.56%1.60%1.65%1.40%
    Profit Before Interest and Taxes40.72%41.82%42.99%33.90%
    Main Ratios    
    Total Debt to Total Assets0.20%0.19%0.18%0.40%
    Pre-tax Return on Net Worth74.59%75.00%76.10%75.00%
    Pre-tax Return on Assets92.60%97.23%102.09%111.30%
    Additional RatiosYear 1Year 2Year 3 
    Net Profit Margin32.60%33.61%34.65%N.A.
    Return on Equity55.50%57.22%58.99%N.A.
    Activity Ratios    
    Accounts Receivable Turnover7.77.87.9N.A.
    Collection Days100100100N.A.
    Inventory Turnover32.434.0234.5N.A.
    Accounts Payable Turnover16.316.416.6N.A.
    Payment Days272727N.A.
    Total Asset Turnover2.42.52.6N.A.
    Debt Ratios    
    Debt to Net Worth-0.03-0.03-0.04N.A.
    Current Liab. to Liab.111N.A.
    Liquidity Ratios    
    Net Working Capital$246,000$259,776$274,323N.A.
    Interest Coverage000N.A.
    Additional Ratios    
    Assets to Sales0.840.880.9N.A.
    Current Debt/Total Assets1%0%0%N.A.
    Acid Test26.72728.3N.A.
    Sales/Net Worth2.12.12.2N.A.
    Dividend Payout000N.A.


    1. Is owning a hair salon profitable?
      If you’re wondering is owning a hair salon profitable, the answer is yes! It’s a highly profitable business with very lucrative rate of return.
    2. How much does it cost to run a salon monthly?
      If you want to know how to start your own hair salon and how much would it cost, consult the business plan above.
    3. How do I start my own hairdressing business?
      For starting a hair salon business plan, just follow the steps we mentioned in this template.
    4. What is a business plan for a salon?
      A business plan just like this free business plan template for hair salon details how a hair salon business consultants is started and maintained to yield profit.

    Download Business Plan for a Hair Salon Sample in pdf