Crunching the numbers for a salon design project can be overwhelming. To make the most sense of it all, we’ve gathered some expert tips for successfully budgeting for your next salon reno or project.
Fom opening a new salon to remodelling your current one, bringing your vision to life all comes down to the numbers. While it’s important to dream big, having essential financial resources at your disposal is what will help bring your dream salon to reality.
“There are a lot of financial insecurities when opening something new,” says Tony Ricci, owner of Ricci Hair Co. in Alberta and Contessa 2017 Canadian Hairstylist of the Year. “As hairstylists, we’re not always business oriented when it comes to understanding the cost factor.”
To keep your spending in check, we’ve narrowed down some key tips for staying on track with your salon reno project.
How to Build Your Team and Budget
Employing a knowledgeable team that understands each and every aspect of your vision can help you throughout the process.
“The key is presenting the budget upfront so everybody has an understanding of what you’re working with,” explains Ricci. “You have to know how much you can afford and what kind of salon you want and be ready to shop around and have discussions.”
When creating the budget for your salon project, Michael Levine, owner of A Michael Levine Salon Group in British Columbia, says it’s about being realistic from the onset. “Some salon owners base their budget numbers on averages or optimism,” says Levine, who is opening a new salon and academy in Surrey, B.C. in 2017. “It’s such a tough business, so even at the best of times you have to base your numbers on pessimism. You hope for the best, but prepare for the worst.”
To help with crunching the numbers, Roy Jouni, owner of Carte Blanche Spa & Haute Coiffure in Orleans, Ont., recommends working with a financial planner. “We’re entrepreneurs and we know our trade,” he says. “As much as we may know about finances, we don’t know as much as financial planners. For example, to get approved for a loan from a bank, you really need to understand the fine print and provide those details that a financial planner can help you with.” As important as a blueprint is to the design, a business plan can be just as significant to the operations side of your salon. A detailed business plan outlines your objectives, revenue goals and costs and can often play a major role when trying to obtain a business loan.
When allotting the right amount of money to each respective area of your salon, a reliable contractor can be a vital part of the process, especially when planning large-scale design projects. Since contractors can often be one of the more expensive costs in your budget, they can make or break your entire project. “I always look for a contractor who has been recommended by somebody so you know who you’re dealing with,” recommends Jouni. “An honest contractor and someone you trust, who sits down with you and tells you how much everything will cost. There’s no way we, as salon owners, would know. Every day, the prices of things go up; electrical wires, copper, etc.”
While Ricci says investing in an experienced contractor is important, a good designer can make all the difference. “I would spend more time with a designer and getting the place looking right. There are always ways to cut back on costs once you get the design factor from a good designer,” he explains. “The environment of the salon is important; people want to feel like it’s a zen place to be.”
Since planning for a salon opening compared to a salon renovation is vastly different, Levine says it’s essential to keep your overall goal in mind. “The goal of a renovation is to give the salon a facelift but not take you back to ground zero financially,” he says. “The goal is to have the biggest impact that will inspire change in your staff and excite clients when they walk in.”
Don’t Forget to Plan for the Future, Too
Seeing and experiencing the end result of your design project should be enjoyable, but it’s also critical to keep your salon’s future in mind—even when your project is still underway. “Operating capital is really the most important thing,” says Levine. “You’re better off spending less and having more in the bank.”
Jouni, who is in the process of building a new lifestyle spa concept, suggests factoring the first few months of rent into your budget to avoid getting into financial trouble as soon as your newly designed project is complete. “I really thought about my rent, my loan and building a nest egg that would set me up for the future,” he explains.
While you may be basking in the glory of your newly designed space, remember to think long-term and plan for depreciation. “After two or three years in a busy salon, you’re going to have to put some work in: fix cracks, repaint, etc,” says Jouni. “I’m not going to let my place look bad or downgraded.” Since it often takes a substantial amount of money to create your dream salon space, it’s important to factor in how you plan on making money to support it (and you!) for years to come.
Tips and Tricks for Planning a Financially Responsible Design Project
- Make a list and check it twice: Using a detailed checklist of your salon’s needs and wants is important to help track your spending.
- Drop some dollars on a good location: When considering a location, spending extra money on a prime spot is money well spent, considering the amount of additional revenue that walk-in traffic can generate.
- Shop around: Request and compare quotes for everything, from contractors and designers to furniture and fixtures. Any money you can save in any aspect of your budget will help you in the long run.
- Expect the unexpected: When it comes to a salon design project, the number one mistake among salon owners is that they don’t leave enough room in their budgets. Playing it too close can backfire, so it’s important to keep a financial cushion when it comes to budgeting for your project.