How To Write The Perfect Nail Salon Business Plan (Free Template Inside)
When one decides to start a business venture, the first thing one focuses on is potential income. And a little birdie told us you were considering opening a nail salon.
Right off the bat, we must say you have great taste, going by your choice of industry and our blog. Let us provide you with an all-essential fact – The average nail salon industry earnings were estimated to gross $287,000 in revenues, with a 17% profit margin. So opening a nail salon might be a lucrative venture for you after all.
But how do you make sure your salon turns a profit consistently? The answer is – by writing a solid nail salon business plan.
Not only will such a plan make your nail salon easier to establish, but it will also equip you with the right tools to succeed in the industry. And the best part? Our step-by-step guide with a free downloadable template will make your job even easier!
We sincerely hope you keep making great choices and read on!
Going back to the basics
Before we delve into the planning, let us first discuss what a business plan truly is. Don’t think of it as a ton of documentation headache to get over with. Rather, think of it as a blueprint. In the hands of a talented architect such as yourself, that blueprint builds the foundation of your business.
A nail salon business plan lays down a roadmap for your salon from marketing, business development, and operational standpoints, by defining its various aspects in detail. It also includes a business summary, talking about the aims and objectives of the nail salon for the future.
So why do YOU need it?
Now that we understand what a business plan truly is, let us establish why it is important. This documentation is essentially a doorway between the past, present, and future.
Sounds far-fetched? Give us a chance to explain.
- It documents the industry statistics and your initial stages, which are soon to be your past. It will help you look back and remember how it all started.
(It may help you learn from mistakes. Not that we’re saying you made any. This was just in case.)
- By taking stock of the current situation (whenever you document, of course) and keeping financial records, you make it your present.
- And by creating those financial projections and laying down growth markers for the next steps, you are looking to your future.
Did our extensive reasoning convince you?
Essentially, by creating a detailed business plan for your nail salon, you are capitalizing on your strengths and giving yourself a competitive edge. So it is imperative to business success, for a salon or any other enterprise.
And this entire blog is structured to be a business plan template for a nail salon. Maybe, made just for you!
What to include in a business plan
So what goes into this big plan we keep talking about? Listed below are the elusive parts. Read on to find out!
- Getting started with market research
- Getting down to business planning
- Getting a marketing plan underway
- Getting to operations planning
- Creating an appendix
- Compiling your detailed business plan
- Nailed it!
Getting started with market research
Understanding your market is an essential part of starting and maintaining a successful business.
You have already begun your market research, you just didn’t know it (or maybe you did?). By looking up your prospective income, and even settling on the idea of creating a business plan for your future nail salon, you’re on the right track.
In this section, we will talk about conducting market research a bit more systematically.
Before we begin, let us introduce you to a fictional nail salon – ‘ABC’s Nails’. It will serve as our case study, to follow their journey of creating a business plan.
So far, for our convenience, they have finalized just their name. In the course of this blog, ABC’s Nails will go on to become a full-fledged nail parlor (on paper, of course). So let us write this nail salon business plan example together.
Analyzing the industry
Keep in mind that we’re writing for ABC’s Nails right now. The first step for us in analyzing the industry is looking up the market trends. According to marketresearch.com –
- Market data estimates that the U.S. nail salons industry was worth $6.5 billion in 2020
- As mentioned previously, the average nail salon industry earnings were estimated to gross $287,000 in revenues, with a 17% profit margin.
- Also noteworthy was that in 2020, the market was down 19% from the prior year.
- This implies that during any economic downturn, your business might face a financial ebb,
- but still, be able to turn a profit as a whole.
This information collected for ABC’s Nails will help us understand opportunities for growth as well as prepare us for any slow days.
We quickly document all this information under the industry analysis of our nail salon business plan and move to the next step.
Defining the target customer (base)
Now that we’re armed with the data about the market for ABC’s Nails, we look for possible customer segments.
An excellent way to approach this step is to create a profile or a persona of your customers. A customer persona is a semi-fictional representation of your ideal customer(s). They’re usually created by interviewing various potential customers, and charting their information together.
To build a persona, consider their –
- Preferred method of communication
- Other demographic details – hobbies, preferences
The below listed persona is from the nail salon business plan sample pdf that we’ve been creating for ABC’s Nails.
By creating multiple such personas, you ensure that you design your nail salon keeping all your customers in mind. This will be helpful in drawing up a marketing plan in later stages as well.
Again, we will add these customer insights in the respective tab in our business plan.
Doing the competitor research
Now ABC’s Nails may be prepared to accommodate their future customers’ wishes but how will they contend with their existing competitors?
By doing competitive research, of course! The answers to these questions can be filed directly in our report –
- Who are the competitors in my locality?
- What services and products do they offer?
- What is their typical pricing?
- What is their branding and marketing strategy?
The answers to most of these questions can be found by looking at their websites online, or even physical directories.
To compile all this information, ABC’s Nails plans on using a table to add clarity to their information, as shown below, but you can choose to use paragraph formats as well.
Getting down to business planning
Our nail salon’s business plan is well and truly underway. The next part will help us sculpt the structure of our future business.
Writing a mission statement
The first and foremost task for ABC’s Nails is defining our aims and goals for the business. A simple yet precise way to do so is by –
- Defining your short term goals (from 6 months to a year)
- Setting up long term goals (a 5-year plan)
- Also, be sure to include the values and what sets you apart from the rest
Once the mission statement is complete, be sure to append it to the growing, new nail technician business plan.
Selecting the products and services to offer
Once a general idea of the nail salon is created in the mission statement, the next step is to create lucrative services and select the right products to offer.
Tip: Make sure while selecting products you cater to both – your customer as well as your own values.
ABC’s Nails is planning on offering a few basic selections as follows –
- Artificial Nails
- Acrylic Overlay
- Dip Powder
- Gel (with or without UV curing)
This newly created list goes straight into the business description for a nail salon.
Setting the right prices
Now that the products and services are decided, we focus on setting the right pricing for the salon. Before setting the exact prices, we check –
- The competitor pricing to understand the market standard and what people are willing to pay.
- That we will be able to cover the basic cost of supplies and return a profit.
Of course, certain personal factors are in play as well. Let’s say you plan on taking only a few customers per week and providing them the highest quality service. Also, take into consideration that you will be working only from 11am – 7pm on weekdays.
In such a scenario, we imagine your nail menu charges would be leaning more towards the higher end of the spectrum, such that your business turns a profit in the limited time you have available.
Once a catalog is prepared, it is also stored in the business plan we are compiling for ABC’s Nails.
(Sorry, no photo here. We don’t want to give away all our secrets after all 😉)
Choosing a location
The space we select for the salon will have a big impact on the overall business. Not only will it affect the spending but also the business goals and aesthetics.
Initially for our pride and joy, ABC’s Nails, we consider the following options –
- Renting a space: When starting out, easier to lease out a space and decorate it according to your aesthetics
- Buying a space: This will take a huge chunk of investment, and lends itself to the more established nail salon owners, rather than a relative newbie such as ABC’s Nails.
Additionally, we have to keep in mind various factors that can affect our choices –
- How competitive the market is
- The area and cost of utilities
- What is our tentative budget
With these factors in mind, we went ahead with scoping out possible (albeit imaginary) locations and adding them to the plan.
Getting the licenses and insurance
Registering your business is considered to be an essential step in business activities. It requires forming the business entity and registering the business through the state government.
Below we compare the various types of businesses you can register as:
Source – sba.gov
Along with a business license, it is common for nail salons to require a cosmetology establishment license before beginning operations.
Once you have acquired your licenses, make sure to store them safely. If you wish, you could add a copy to your business plan doc as well.
Calculating the startup cost
Now that the business processes have been dispensed with, it is now time to plan the budget for your nail salon. You can refer to the below estimate table we have prepared for ABC’s Nails.
Thus, an estimated minimum cost of $3,690 is found for ABC’s Nails. Depending on your location and other factors, your costs might be higher or lower.
Creating financial projections
A crucial part of any business plan is its financial projections. It shows the tentative spending as well as the estimated growth for the nail establishment.
Now that we have prepared both the revenue (or pricing) sheet and our spending (or startup cost) sheets, we analyze them together to be included as the nail salon financial plan.
Many small businesses close within the first couple of years of opening, as their spending is higher than their income.
We are preparing to avoid such a situation for our nail parlor, by creating the following charts to be included in the free sample business plan for ABC’s Nail salon-
- Prospective profit/loss sheet: Overall sheet that tabulates your revenues, costs, and expenses incurred during a specific period of time. It shows the ability of your business to generate profits by increasing revenue and reducing costs.
- Prospective balance sheet: This indicates the financial future of your business. Using your profit and loss spreadsheet, you can project what your balance sheet will look like at the end of your first year.
- Break-even analysis: This indicates when your business will be able to cover all of its expenses and begin making a profit.
This brings us to the end of our business planning section. Next, we tackle our marketing plan for ABC’s Nails.
Getting a marketing plan underway
This plan of ours is shaping up nicely. Good job, us! Now we move on to planning the marketing aspect to round up our plan.
Defining the market positioning
From ABC’s Nails mission statement and customer personas, we are clear on who we wish to cater to in terms of the customers. So now we define where we stand in the market.
- Are we a high-end salon or a more economical one?
- Who are our direct competitors?
- What sets us apart from the rest?
- What are the market factors that impact our nail salon business?
Once we pen down the answers, we will be well equipped to understand where our business will fit in the market, and develop a marketing strategy effectively. Of course, we will be adding our answers to the business plan doc.
Brainstorming strategies to attract customers
Attracting customers is the most basic goal of a successful marketing strategy. As we start our business, our aim is to draw the attention of potential customers to our business and bring them in.
A few examples of such strategies are:
- Opening discount
- Discount coupons
- Free gift/service with another service, etc.
If you want to read more, take a gander at our other informative blog – nail salon marketing ideas.
Deciding the platforms to advertise on
As a direct business-to-consumer industry, your marketing will directly target your customers. You need to know who your customers are (the personas you created, remember?) and how you can reach them.
Before choosing our advertisement channels, we ask the following questions:
- Where do your customers spend time, both on and offline?
- What social media platforms are they most likely to use?
- What, if any, print media are they reading?
- Do they listen to traditional radio or stream their music?
Based on these questions, and matching the answers with our customer personas, ABC’s Nails arrives at the conclusion that we will choose to advertise on –
- Digital Ads
- Social media – preferably Instagram and Facebook
As per usual, we make sure this has gone into our business plan.
Customer retention planning
Now, attracting customers is one thing, but retaining them requires building effective communication and strong connections.
Our favorite Nail Salon – ABC’s is planning on following this motto –
Loyal customers = Ambassadors
This means we’re going to be offering loyalty programs – a discount for customers who refer other customers. (We will quickly go and tweak our marketing budget now.)
Along with this, methods to retain customers can be
- Staying active on social media
- Reaching out with new product offerings or promotions
- Providing stellar customer service and
- Streamlining your appointment system
which can keep your clients coming back for more.
How do you streamline appointments, you ask? Well, simply by using a nail salon scheduling software such as Appointy, especially built to cater to the needs of a nail tech such as you. By investing in such an affordable software option you :
- Automate your scheduling processes: booking appointments, managing salon timings, and also the staff availability
- Free up more time to focus on what you love doing – nails!
- Save the cost of hiring a receptionist
- Store client information to provide them a more personalized experience in near future.
What’s more, is that you can integrate with RwG and provide a ‘book now’ button to nudge viewers of your salon’s page to take action and become your clients!
So what are you waiting for? Explore our nail salon software today.
Getting to operations planning
Yay! This is the second to last part of the business plan that you need to complete. Keep going.
Unless you plan on operating a mobile nail parlor, you will need to hire a couple of employees. (However, our template still stands valid as a mobile nail salon business plan, if you wish to keep following it)
The hiring for ABC’s Nails will be done on the basis of these questions –
- The number of manicure and pedicure stations we wish to keep
- Eg – 3 and 2 respectively
- What additional services do we plan on offering
- Eg – None
- How much can we afford to spend on staff wages
- $15000 (estimated)
Based on this, we require at least 2 more nail technicians, who we will be able to pay well.
While interviewing, you can
- Look for qualities and values that align with your business.
- Make sure they have a strong work ethic
- Check if they are dependable and responsible prospects
- Ensure that they have good communication skills
- Confirm that they are good team players.
Setting up a training plan
This will be an integral part of your nail salon’s success, as your employees will interact with your customers on a daily basis. What can we do to make sure that our service is on point? These steps –
- Develop a training plan
- Include skills training sessions as well
- Customer service training plan
Having a plan in place well ahead of time will help you train your employees properly, even in the busiest of times.
Linking the tech
In the 21st century, it is imperative that you fulfill the demands of all your customers – including Gen Zers. And they want the latest technology.
- Set up your Google Business page
Having a Google business page ensures that when a customer searches for “nail salon near me”, your salon pops up.
The reviews and ratings that your salon will accumulate in the future will add to the trust factor in the community as well.
- Integrate a Point Of Sale (POS) system
A POS system is critical to your business in managing day-to-day finances.
Along with POS, setting up a few different payment methods such as – Square, Stripe, PayPal makes payment easy for your customers and gives them the freedom to choose their payment option.
- Adopt a CRM and scheduling software
The scheduling software we mentioned before will be an enormous help to gratify each customer’s wishes. Even before they reach your salon, they will be able to view the available slots, prepay online and view a detailed service menu – all in one place. And an added bonus is that their purchasing habits will be stored in the cloud, to be able to change them in the future.
Setting up an Appointy booking page is very easy. As you can see in the below example, Covered Nail Bar is offering its customers a wide variety of services to choose from.
Preparing an expense report
When you are running a business, you are in charge of paying all the bills –
- Utility bills
- Staff wages, etc.
Filing away all these and then manually adding them to your balance sheets can be a laborious task. So using a fixed template each time will ease your burden greatly. You can choose to create your own spreadsheet or use one of these example templates.
Once you have your expenses entered, you can use the inbuilt functions of your spreadsheet to import them to your final balance sheet.
Creating an appendix
You are nearly at the end of creating your nail salon business plan.
Now what’s left is linking relevant supporting documents such as-
- Your research document
- Your salon location and other details
- Any vendor details and their business details
and any overhead costs or documents to your main business plan.
Essentially, by attaching such documents, you are solidifying your business venture and its proposal and showing that your business is indeed ready to be launched!
The end of this section marks the end of four main parts of the nail salon business plan.
Compiling your detailed business plan
Now that the grunt work has been dispensed with, it is smooth sailing ahead. Just one small, but rather important task and a shiny, new nail salon business plan will be ready.
Writing an executive summary
We are armed with all the information we could need about the nail salon we are establishing. What better time to write an executive summary than now?
In the summary, briefly tell your reader
- About your company and why it will be successful.
- Include parts of your mission statement,
- Your products and services,
- And basic information about your company’s leadership team, employees, and location.
If you were planning on submitting this report to secure funding, you should also include financial information and high-level growth plans. Just make sure that the summary does not exceed more than 1-2 pages!
Attach it at the very front of your business plan and you are all set.
Download the free nail salon business plan template!
Detailed and yet aesthetically pleasing, type in or print out to write in our professional business plan template today.
Hearty congratulations are in order! After all, if you were working along with us, you are now the proud writer of a shiny new nail salon business plan. And even if you were not writing, we are sure you can go back to the beginning and follow along the next time.
We covered the basics of writing a business plan for a nail salon in this blog. If you want more information on the basics of opening a nail establishment, we recommend you go through our other blog – How to Open a Nail Salon.
We wish you the best of luck in your new endeavor!
We at Appointy, help business owners grow and run their businesses with our online scheduling software. This blog was a part of our ‘Manage your Business’ category, where we provide expert tips, resources, or simply talk about the challenges that small and medium businesses face every day.
If you have any thoughts on this blog, or would like to chat about your business struggles and achievements, let us know in the comments below.
We love a good talk!