So let's proceed to the business planning section. Table of Content hide. 1 Why Start a Cosmetology School? 2 Cosmetology School Business Plan – Executive.

Cosmetology School Business Plan, Marketing Plan, How To Guide, and Funding Directory

The Cosmetology School Business Plan and Business Development toolkit features 18 different documents that you can use for capital raising or general business planning purposes. Our product line also features comprehensive information regarding to how to start a Cosmetology School business. All business planning packages come with easy-to-use instructions so that you can reduce the time needed to create a professional business plan and presentation.

Your Business Planning Package will be immediately emailed to you after you make your purchase.

Product Specifications (please see images below):

• Bank/Investor Ready
• Complete Industry Research for the Industry
• 3 Year Excel Financial Model
• Business Plan (26 to 30 pages)
• Marketing Plan (24 to 28 pages)
• 425+ Page Funding Directory
• PowerPoint Presentation
• Loan Amortization and ROI Tools
• Three SWOT Analysis Templates
• How to Start a Business Guide
• Easy to Use Instructions
• All Documents Delivered in Word, Excel, and PowerPoint Format
• Meets SBA Requirements

Cosmetology schools are able to render service that is very much in demand in any economic climate. In fact, during difficult economic times – many trade schools like cosmetology schools actually wash their revenues increase as more people seek to enter a trade and learn a new skill. As such, cosmetology schools are generally able to remain profitable and cash flow positive at all times. The barriers to entry for starting a new cosmetology school are somewhat low given the fact that simply a retail location with a number of different booths for rendering services is required. Typically, the startup costs associated with the new cosmetology school run anywhere from $50,000 to $100,000 depending on the amount of equipment that is necessary in order to launch operations. In most suburban or rural markets it can be expected that the development of a new cosmetology school will be on the lower end of the startup cost spectrum. Most importantly, once these businesses are able to receive their licensure in order to provide these services to the general public – there are very few ongoing operating risks associated with this type of business. People are always going to want to learn how to cut and style hair in any economic climate. Additionally, there are very few risks relating to the future of automation that would impact the way that these companies conduct their business.

A cosmetology school SWOT analysis should be produced as well. As it relates to strengths, cosmetology schools are able to generate income not only from tuition fees but also from providing low-cost haircuts and styling to the general public. In fact, about 30% to 40% of all revenues typically come from people that want to have their hair styled by a student cosmetologist. As such, the multiple revenue streams generated from these services further reduce the ongoing risks associated with operating this type of company.

For weaknesses, in any given market there are usually a handful of other providers that render cosmetology school services to the general public. These schools will often have to compete as it relates to the amount of tuition that they charge coupled with the costs associated with providing haircuts to the general public. The barriers to entry, again, are relatively low and they are able to have competitors enter the field relatively quickly.

For opportunities, cosmetology schools typically expand by establishing new locations outside of their target market radius. Given the relatively low costs associated with starting a cosmetology school, once the initial location is profitable it is very easy to expand operations in other metropolitan area markets. These businesses can also develop proprietary products that allow them to boost their revenues through product sales.

Regarding threats, there is very little that is going to change as it relates to training an individual as to how to become a hairstylist, aesthetician, or cosmetologist. As such, these businesses primary threat will continue to come from competition within the target market.

As these businesses generate substantial revenues from tuition, hairstyling, and product sales – almost all financial institutions are willing to assist with providing the capital to get operations off the ground. This is especially true given that a significant amount of the startup costs is associated with the acquisition of tangible furniture, fixtures, and equipment. If the entrepreneur starting this business is seeking capital then they are going to need a cosmetology school business plan.

As with all types of business planning documents, a three-year profit and loss statement, cash flow analysis, balance sheet, breakeven analysis, and business ratios page should be included. A full demographic analysis should also be developed that showcases the number of people within the target market, number of hair salons in the market, median household income, median family income, population size, population density, and the number of people that graduate from high school on a yearly basis. As will be discussed below, a marketing campaign that focuses substantially on recruiting newly graduated high school students is one of the keys to thriving within this industry. As it relates to industry research, there are approximately 5,000 cosmetology schools in the United States and each year these businesses generate about $1.5 to $1.7 billion of revenue. The industry employs about 50,000 people.

A cosmetology school marketing plan should be developed so that it focuses substantially again on recruiting individuals that have graduated from high school but are not going to be attending college. Foremost, it is imperative that the entrepreneur maintain very close relationships with area high schools, technical schools, career counselors, and other individuals that are involved with placing people in professions that they might like. These referrals become an invaluable source of business for a cosmetology school given that recommendations from guidance counselors and related professionals carry a substantial amount of weight. A proprietary website should be developed as well that showcases the school, hours of operation, certificates offered, courses offered, and how much tuition costs on a yearly basis. Typically, the cost associated with a becoming a cosmetologist ranges anywhere from $3000 to $8000 depending on whether or not credit is given for providing low-cost hairstyling to the general public. The website should be listed among all major search engines.

A presence on social media should also be developed so that an individual that is looking online for recommendations for cosmetology school can quickly be referred to among friends and professional communities. The cost associated with maintaining a presence on FaceBook, Twitter, Instagram for photos, and LinkedIn is very low. As such, the low-cost investment of maintaining a presence on popular social media platforms can return a very strong amount of revenue as new people enroll in the company’s services. A social media manager can be hired on an outsourced basis to manage the social media pages maintained by the company.

Cosmetology businesses can be highly lucrative educational institutions that provided their owners with a highly predictable stream of revenue and profits. Although many industries are facing certain risks as it relates to the advancement of technology – haircuts and hairstyling is going to be one of the industries that remain strong despite any changes in technology where the economy. Given that everyone needs a haircut from time to time, cosmetology schools are almost always able to remain profitable given that they do render services to the general public. As such, the outlook for the development of a new cosmetology school is very strong over the next 20 years.

Over the past 20+ years, we have helped over 10,000 entrepreneurs and business owners create business plans to start and grow their beauty salons. On this page, we will first give you some background information with regards to the importance of business planning. We will then go through a beauty salon business plan template step-by-step so you can create your plan today.

What Is a Business Plan?

A business plan provides a snapshot of your beauty salon as it stands today, and lays out your growth plan for the next five years. It explains your business’ goals and your strategy for reaching them. It also includes market research to support your plans.

Why You Need a Business Plan

If you’re looking to start a beauty salon or grow your existing beauty salon you need a business plan. A business plan will help you raise funding, if needed, and plan out the growth of your beauty salon in order to improve your chances of success. Your beauty salon business plan is a living document that should be updated annually as your company grows and changes.

Source of Funding for Beauty Salons

With regards to funding, the main sources of funding for a beauty salon are bank loans and angel investors. With regards to bank loans, banks will want to review your business plan and gain confidence that you will be able to repay your loan and interest. To acquire this confidence, the loan officer will not only want to confirm that your financials are reasonable. But they will want to see a professional plan. Such a plan will give them the confidence that you can successfully and professionally operate a beauty salon business.

The second most common form of funding for a beauty salon is angel investors. Angel investors are wealthy individuals who will write you a check. They will either take equity in return for their funding, or, like a bank, they will give you a loan. Venture capitalists will not fund a beauty salon. They might consider funding a chain of beauty salons, but never an individual location. This is because most venture capitalists are looking for millions of dollars in return when they make an investment, and an individual location could never achieve such results.

Beauty Salon Business Plan Template

Your beauty salon business plan should include 10 sections as follows:

Executive Summary

Your executive summary provides an introduction to your business plan, but it is normally the last section you write because it provides a summary of each key section of your plan.

The goal of your Executive Summary is to quickly engage the reader. Sonic the hedgehog vocal traxx several wills rar extractor download. Explain to them the type of beauty salon you are operating and the status; for example, are you a startup, do you have a beauty salon with existing customers and revenues that you would like to grow, or are you operating a chain of beauty salons.

Next, provide an overview of each of the subsequent sections of your plan. For example, give a brief overview of the beauty salon industry. Discuss the type of beauty salon you are operating. Detail your direct competitors. Give an overview of your target customers. Provide a snapshot of your beauty salon’s marketing plan. Identify the key members of your team. And offer an overview of your financial plan.

Company Analysis

In your company analysis, you will detail the type of beauty salon you are operating.

For example, you might operate one of the following types:

1. Beauty salon focusing strictly on hair styling
2. Beauty salon offering hair removal services
3. Beauty salon offering skin care services
4. Beauty salon offering nail services
5. Beauty salon offering tanning services
6. Beauty salon offering massage services
7. Beauty salon offering products
8. Combination of the above types

In addition to explaining the type of beauty salon you operate, the Company Analysis section of your business plan needs to provide background on your business.

Include answers to question such as:

• When and why did you start your beauty salon business?
• What milestones have you achieved to date? Milestones could include sales goals you’ve reached, new store openings, etc.
• Your legal structure. Are you incorporated as an S-Corp? An LLC? A sole proprietorship? Explain your legal structure here.

Industry Analysis

In your industry analysis, you need to provide an overview of the beauty salon business.

While this may seem unnecessary, it serves multiple purposes.

First, researching the beauty salon industry educates you. It helps you understand the market in which you are operating.

Secondly, market research can improve your strategy particularly if your research identifies market trends. For example, if there was a trend towards a new type of hair or beauty service, it would be helpful to ensure your plan included offering such services.

The third reason for market research is to prove to readers that you are an expert in your industry. By conducting the beauty salon industry research and presenting it in your plan, you achieve just that.

The following questions should be answered in the industry analysis section of your beauty salon business plan:

• How big is the beauty salon business (in dollars)?
• Is the market declining or increasing?
• Who are the key competitors in the market?
• Who are the key suppliers in the market?
• What trends are affecting the industry?
• What is the industry’s growth forecast over the next 5 – 10 years?
• What is the relevant market size? That is, how big is the potential market for your beauty salon. You can extrapolate such as figure by assessing the size of the market in the entire country and then applying that figure to your local population.

Customer Analysis

The customer analysis section of your beauty salon plan must detail the customers you serve and/or expect to serve.

The following are examples of customer segments: college students, sports enthusiasts, soccer moms, techies, teens, baby boomers, etc.

As you can imagine, the customer segment(s) you choose will have a great impact on the type of beauty salon you operate. Clearly baby boomers would want a different atmosphere, pricing and product options, and would respond to different marketing promotions than teens.

Try to break out your target customers in terms of their demographic and psychographic profiles. With regards to demographics, include a discussion of the ages, genders, locations and income levels of the customers you seek to serve. Because most beauty salons primarily serve customers living in their same city or town, such demographic information is easy to find on government websites.

Psychographic profiles explain the wants and needs of your target customers. The more you can understand and define these needs, the better you will do in attracting and retaining your customers.

Competitive Analysis

Your competitive analysis should identify your indirect and direct competitors and then focus on the latter.

Direct competitors are other beauty salons.

Indirect competitors are other options that customers have to purchase from you that aren’t direct competitors. This includes products (beauty polish, beauty files, etc.) they can purchase from supermarkets and other retailers both offline and online. You need to mention such competition to show you understand that not everyone in your target market frequents a beauty salon on a regular basis or at all.

With regards to direct competition, you want to detail the other beauty salons with which you compete. Most likely, your direct competitors will be beauty salons located close to your location.

For each such competitor, provide an overview of their businesses and document their strengths and weaknesses. Unless you once worked at your competitors’ businesses, it will be impossible to know everything about them. But you should be able to find out key things about them such as:

• What types of customers do they serve?
• What services do they offer?
• What products do they offer?
• What is their pricing (premium, low, etc.)?
• What are they good at?
• What are their weaknesses?

With regards to the last two questions, think about your answers from the customers’ perspective. And don’t be afraid to stand outside your competitors’ locations and ask customers as they leave what they like most and least about them.

The final part of your competitive analysis section is to document your areas of competitive advantage. For example:

• Will you provide superior beauty salon services?
• Will you provide superior beauty salon products?
• Will you provide beauty salon services that your competitors don’t offer?
• Will you make it easier or faster for customers to acquire your products?
• Will you provide better customer service?
• Will you offer better pricing?

Think about ways you will outperform your competition and document them in this section of your plan.

Marketing Plan

Traditionally, a marketing plan includes the four P’s: Product, Price, Place, and Promotion. For a beauty salon business plan, your marketing plan should include the following:

Product: in the product section you should reiterate the type of beauty salon that you documented in your Company Analysis. Then, detail the specific services you will be offering.

Price: Document the prices you will offer and how they compare to your competitors. Essentially in the product and price sub-sections of your marketing plan, you are presenting the menu items you offer and their prices.

Place: Place refers to the location of your beauty salon. Document your location and mention how the location will impact your success. For example, is your beauty salon located next to a heavily populated office building, or gym, etc. Discuss how your location might provide a steady stream of customers.

Promotions: the final part of your beauty salon marketing plan is the promotions section. Here you will document how you will drive customers to your location(s). The following are some promotional methods you might consider:

• Making your beauty salon’s front store extra appealing to attract passing customers
• Developing and marketing your website
• Social media marketing (advertising and organic posts)
• Advertising in local papers and magazines
• Reaching out to local bloggers and websites
• Flyers
• Partnerships with local organizations
• Local radio advertising
• Banner ads at local venues

Also think about your beauty salon’s Unique Selling Proposition (USP), which should answer why customers should choose you over other beauty salons. Make sure your USP is reflected in your marketing.

Operations Plan

While the earlier sections of your business plan explained your goals, your operations plan describes how you will meet them. Your operations plan should have two distinct sections as follows.

Everyday short-term processes include all of the tasks involved in running your beauty salon such as serving customers, procuring supplies, keeping the beauty salon clean, etc.

Long-term goals are the milestones you hope to achieve. These could include the dates when you expect to serve your 1,000th customer, or when you hope to reach $X in sales. It could also be when you expect to hire your Xth employee or launch a new location.

Management Team

To demonstrate your beauty salon’s ability to succeed as a business, a strong management team is essential. Highlight your key players’ backgrounds, emphasizing those skills and experiences that prove their ability to grow a company.

Ideally you and/or your team members have direct experience in the beauty salon business. If so, highlight this experience and expertise. But also highlight any experience that you think will help your business succeed.

If your team is lacking, consider assembling an advisory board. An advisory board would include 2 to 8 individuals who would act like mentors to your business. They would help answer questions and provide strategic guidance. If needed, look for advisory board members with experience in beauty salons and/or successfully running retail and small businesses.

Financial Plan

Your financial plan should include your 5-year financial statement broken out both monthly or quarterly for the first year and then annually. Your financial statements include your income statement, balance sheet and cash flow statements.

Income Statement: an income statement is more commonly called a Profit and Loss statement or P&L. It shows your revenues and then subtracts your costs to show whether you turned a profit or not.

In developing your income statement, you need to devise assumptions. For example, will you serve 20 customers per day or 50? Will your average price point be $50 or $100? And will sales grow by 2% or 10% per year? As you can imagine, your choice of assumptions will greatly impact the financial forecasts for your business. As much as possible, conduct research to try to root your assumptions in reality.

Balance Sheets: While balance sheets include much information, to simplify them to the key items you need to know about, balance sheets show your assets and liabilities. For instance, if you spend $100,000 on building out your beauty salon, that will not give you immediate profits. Rather it is an asset that will hopefully help you generate profits for years to come. Likewise, if a bank writes you a check for $100.000, you don’t need to pay it back immediately. Rather, that is a liability you will pay back over time.

Cash Flow Statement: Your cash flow statement will help determine how much money you need to start or grow your business, and make sure you never run out of money. What most entrepreneurs and business owners don’t realize is that you can turn a profit but run out of money and go bankrupt. For example, let’s say a company approached you with a massive $100,000 beauty salon contract to provide beauty salon services to their employees. Let’s assume the contract would cost you $50,000 to fulfill. Well, in most cases, you would have to pay that $50,000 now for supplies, employee salaries, etc. But let’s say the company didn’t pay you for 180 days. During that 180 day period, you could run out of money.

In developing your Income Statement and Balance Sheets be sure to include several of the key costs needed in starting or growing a beauty salon:

• Location build-out including design fees, construction, etc.
• Cost of equipment like chairs, washing equipment, etc.
• Payroll or salaries paid to staff
• Business insurance
• Licenses and permits
• Legal expenses

Appendix

Attach your full financial projections in the appendix of your plan along with any supporting documents that make your plan more compelling. For example, you might include your beauty salon’s design blueprint or location lease.

Summary & Keys to Beauty Salon Success

Putting together a business plan for your beauty salon is a worthwhile endeavor. If you follow the template above, by the time you are done, you will truly be an expert. You will really understand the beauty salon business, your competition and your customers. You will have developed a marketing plan and will really understand what it takes to launch and grow a successful beauty salon.

Finally, in addition to completing your business plan, be sure to pay special attention to the following factors that often define success for beauty salon businesses:

1. Make sure all of your clients are thrilled with your services
2. Keep your beauty salon clean at all times
3. Provide excellent communications with current and prospective clients
4. Embrace new technology, particularly social media to engage your clients and get them to return to your beauty salon
5. Focus on growing revenues, but also on profits, by keeping a close eye on costs
6. Hire the right team, train them well and treat them well so their performance is strong and they are loyal to your business

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