Business Plan to Set Up a Hairdresser

We continue with our series of articles where we analyze how to develop a business plan. And in today’s article, we will focus on making a business plan to set up a hairdresser.

Before entering the article’s main content, we will answer a question that surely has crossed your mind since you first thought about starting your hairdresser.

Why set up a hairdresser?

Personal care businesses are booming, as evidenced by the proliferation in cities of franchises for both men and women.

It is a highly demanded service, and with many ways of differentiation, so by developing a good business plan, the chances of successfully establishing yourself in the market are high.

According to INE data, there is one hairdresser for every 900 inhabitants. This indicates that profitability is achieved with a small number of loyal customers thanks to being a regular consumer service.

In addition, it does not present barriers to entry as a large investment or high qualification is not necessary to start the business. Although, as we will see later, there are possibilities of income diversification of a hairdresser that will require an investment and higher qualification.

Business plan for a hairdresser

In the following points, we will analyze the different sections that your barber shop business plan should have—offering useful tips to understand your project’s needs.

Market research

In the first place, you must investigate your market. Analyzing your environment to detect the opportunities and threats it presents.

Don’t be alarmed if you find many threats to your project. All entrepreneurs have had to face them. And what differentiates successes from failures is how they avoid threats or manage to turn them into opportunities.

For example, the place where you establish your hairdresser will be key since one of the strongest decision factors for consumers in this sector is proximity.

You can consider a threat to place a location near a hairdresser with a long history. But it may be that it is focused only on one type of public – users with a classic taste – existing in the area a lack of a service focused on a more modern public.

This brings us to the next point: detecting your target audience. You must identify the type of public in the area where you locate your business and adapt the service accordingly (or vice versa). Going to your city’s census data will help you understand the demographic profile in each neighborhood of your city.

Finally, once you have identified your target audience and the environment where you have detected more market opportunities, investigate your competition. Analyzing the level of service it provides, differential characteristics of its business, prices, etc.

Internal analysis

In the internal analysis, you must detect those characteristics that can differentiate you from the competition. In service as personal as a hairdresser, it will be related to your experience as a hairdresser, your organizational capacity to manage the business, client portfolio, quality of service, customer service, or innovative business model that breaks with market standards.

Service

The service you provide to your customers will be the key to your business. And it would help if you took care that it fits the maximum to your tastes and needs.

You do not have to provide the service you have planned. You must identify what is being offered in the market, the target audience you are targeting, and offer a service in its quality-price range that differs from your competitors.

It is necessary that you find the differential factors in the market and draw a brand positioning strategy. The client is clear with what differential value you will offer him and that he will not find in other close competitors.

At this point, you will have to define the variety of services you will provide, the quality of the products you use, and the attention you provide to your customers.

Depending on the price you set, you will have to adjust the time dedicated to each client. However, it would help if you took care of the treatment offered because it plays a fundamental role in service as close as a hairdresser.

Also, it would help if you tried to diversify your sources of income. You can offer a multitude of complementary services to the haircut itself, in addition to selling beauty products to your clients. Some of them are:

• Makeup.
• Hair removal.
• Manicure.
• Body treatments.
• UVA rays.
• Operations and management

The next step will be to define the essential operations that will intervene in the development of the activity. As well as the necessary management tasks on a day-to-day basis.

These will include dealing with suppliers, setting the appointment schedule to cover employees’ working hours, training on new techniques or treatments, controlling expenses and income, and much more.

Marketing plan

In your hairdresser’s business plan, you can not miss the actions that you will carry out to make it known in the market. You must dedicate a part of your budget to marketing to get new clients.

Having a website, being present on social networks, running contests, investing in online advertising campaigns, web positioning, or traditional advertising are some of the actions that you can carry out.

But don’t make the mistake of stopping investing when you start to have a full schedule. Keep investing as this will add value to your brand, you will maintain the volume of work, and you will be able to increase prices when the demand exceeds your offer.

Financial plan

The financial plan has to predict costs and revenue. This would encourage you to make savings that will fulfill your personal financial goals.

To finally make an estimate to calculate when the business will start to be profitable. We will analyze each of the parts with an example of the concepts found in each of them.

Initial investment

The initial investment that you may need to set up a small salon may have the following concepts:

Incorporation and licensing expenses: $ 3,000

Rent of the premises (first month + two months of deposit): $ 7,000

Furniture and tools (decoration, machinery and utensils) : $ 40,000

TOTAL : $ 50,000

Income Forecast

First, you have to calculate the average ticket. You must write down the different services you provide and the price of each of them.

Then you will have to calculate the maximum level you can produce. That is the maximum capacity of your business. Adding the number of hours of each employee and the volume of work per hour.

By forecasting the maximum output, you can make an effective prediction. In the first months of service, you can not make any income.

Fixed costs

Fixed costs are those that do not vary according to the volume of work. That is, they will remain unchanged whether the store is closed or is crowded with customers. Among the main ones are:

• Rental of the premises.
• Advisory service.
• Staff salaries.
• Supplies.
• Advertising and marketing.
• Debt interest.
• Variable costs

They will be those that derive from the service provision—for example, the products used in the same provision.

Executive Summary

For last, we have left the executive summary, although it will be found in the first pages of the document. And I will leave it for the end because it will be the last thing you will have to write since it summarizes the entire business plan.

The executive summary should be written thinking that it will be the first thing that potential investors or the person in charge of the bank that studies your project’s financing will read. So it would help if you highlighted all the opportunities it offers, the strengths of your proposal, and how to deal with the threats you face.

Conclusions

Now you know which parts you should include in your hairdresser’s business plan. But do not take it as a rigid structure, but as a guide with the minimum points that it must contain.

If you are in a sea of ​​doubts and do not even know where to start, you can get in touch, and one of our qualified business advisors will help you.