Have you ever wondered why some salons hit the ground running from day one, while others struggle within the first few months? The secret lies in a well-thought-out financial plan and clear awareness of where the money is coming from—and where it’s going. Every dream of owning a salon starts with a simple question: How much do I really need? Or more honestly – do I have enough cushion to ensure all plans come to life without anything ending up on the “back burner”?

Calculating Startup Capital: What Does “Total Cost” Include?

It might seem that opening a salon only requires a couple of stylish chairs, a good mirror, and a few branded products on the shelves—but in reality, the expenses run much deeper and are cleverly hidden. Breaking it down, the most important factors are:

  • Lease deposit and rent: Make sure the lease agreement clearly lists all potential landlord demands—two months’ rent upfront, security deposit, broker fees. These are costs you cannot delay; they must be paid right at the start.
  • Furniture and decor: All your trendy chairs, statement sofas, shelving units, mirrors, and cabinets for staff. Small details like lighting fixtures and curtains can surprisingly add up to a significant budget line.
  • Equipment and tools: The devices needed to offer your services top the list—manicure sets, hair dryers, sterilizers, UV lamps, and more. Make a comprehensive inventory of all tools, even if you don’t need everything immediately.
  • Products and supplies: Shampoos, tissues, gloves, cotton pads—and other small essentials that often get forgotten. Pro tip: stock just enough rather than too much. Money tied up in expired products won’t bring in any clients.

As you make your list, don’t forget the smaller but unavoidable items: cash register, computer, online booking system (like SalonLife), first aid kit, cleaning supplies, and various mandatory fees and permits.

For a more detailed overview of costs and startup calculations, check out “Calculating the Cost of Opening a Beauty Salon: A Comprehensive Guide”.

Now take all those expenses, add them up, and confidently tack on an extra 10–15% for unexpected costs! There’s always something—an old pipe that needs fixing, an unforeseen legal requirement, or a new idea you hadn’t even considered.

Cash Flow Management: Will the Money Last After Opening?

Great, you’ve covered startup costs—hooray! But have you thought about the new monthly expenses that come after opening? The first few months can be especially tough while your client base builds. Here are some key points to keep in mind:

  • Fixed costs: Rent, staff wages, utilities, phone and internet bills, accounting fees, small additional purchases, lease payments.
  • Revenue forecast: Knowing your service prices and how many clients you can serve weekly, calculate how many clients you need each month just to break even. Then divide that number by the weeks!
  • Conservative budget: Estimate revenues on the lower side and expenses on the higher side to avoid unpleasant surprises. Ask yourself: how long can I stay break-even if revenue grows gradually?

Wondering how to better manage finances on the go and optimize things like inventory or invoice handling? Find practical inspiration and tips on our blog: Our Top Picks for Beauty Salon Accounting Software.

Where to Find Startup Capital?

Now that you know exactly how much you need, the burning question is: where will that money come from? Luckily, you’re not alone in searching for answers. Here are the main options:

  1. Personal savings: If you’ve been dreaming of opening a salon for years, you might have built up enough reserve to confidently get started. Think about risk diversification—it’s not fun to discover in winter that all your money is tied up in chairs and mirrors.
  2. Loans: Small business loans from banks or even borrowing from friends. Consider: can you cover loan payments every month, even if customer flow is slow at first? Before taking on debt, carefully evaluate terms—and consider consulting a professional.
  3. Grants and subsidies: Government programs, economic development agencies, local municipality initiatives—there are options if you know where and how to apply. Usually, you’ll need a solid business plan and financial forecast explaining how the funds will be used.

If you still can’t raise the full amount, think about alternatives: a co-owner, starting smaller and expanding later, help from family or friends—or even private investors. The key? Negotiations and clear agreements! Every partner or lender expects something in return—be it transparent reporting or clearly defined returns.

Practical Tips and Small Tricks

  • Write down EVERY expense. Even those that seem almost invisible—you’ll see how “almost” can turn into “uh-oh” by month’s end.
  • Don’t hesitate to ask for help: An accountant, business advisor, or experienced salon owner can be invaluable sources of advice—use their knowledge!
  • Try free tools: Websites of government agencies and banks often provide simple budget templates that help you achieve “aha” moments when you see your numbers on paper.

To find modern tools and simplify salon management, also explore our salon management software recommendations—the right digital solutions provide confidence, save time, and help avoid financial mistakes.

By setting all this groundwork before launch, you build a much stronger foundation for running your salon. You’ll be like a marathon runner in the starting blocks, not just standing on the sidelines watching the race.

Don’t worry if it feels overwhelming at first. Keep moving forward—the next big step is choosing the right business structure and handling all the official paperwork. But that’s a story for the next article… Are you ready?