New franchised salon

[SunseraWarman]

We have just bought into a franchised Hair & Tanning Salon and Day Spa in a small city in Saskatchewan called Warman, located about 20 minutes outside of Saskatoon. We are in a great location I figure as we are right in the main strip mall and there is only one other Salon in the entire city. Although the city is small (No more then 9000 people) we seem to be building a client base at a fairly fast rate (1200 since April of this year.) The intial investment for the business was fairly pricey (Near the 450k range) but the salon is equipped with absouletly everything we need from the Helios software, T-Max timers, 5 tanning beds, a mystic tan booth pedicure and manicure stations and supplies supplies, hair cutting equipment, and massage equipment. Also included in the price to begin was about 25k in retail products. The salon is absoultly beautiful and all the advertising is taken care of (professionally done pamphlets, business cards, tanning forms, massage forms contracts, billboards, custom made nail files, coffee mugs etc.) Also our location is advertised on the Franchise website, SunseraSalons.ca. I could post pictures of what the entire salon looks like if anyone would like to see, but i just wanted to know what people really think of the investment.

[Ken]

The only important question is "What do you think of your investment?"

[Black Sun]

OUCH!!!
In a town of only 9,000 bodies I do not know how one can re-coup such an investment. I understand you already have 1200, but how many are repeats and pay each visit and buy each visit....
1200 out of 9000, just makes no sense. Industry stats show less than 10% would use a salon/spa...but regardless, what are your monthly expenses/overhead/franchise fee?

Personally, I think the 450K could have been spent better in another investment.
Good luck.

[SunseraWarman]

I believe it is a good investment because this community is rapidly growing and the Sunsera franchise is well known around Saskatoon and area. I will post pictures in the next few days and show you exactly why it was how much it was. It seems to be going great except that we opened just before slow season

[House of Tan]

Originally Posted by Black Sun

1200 out of 9000, just makes no sense. Industry stats show less than 10% would use a salon/spa...Good luck.

This is a hair and tanning set up. You are reffering to indoor tanning in general with the 'Less than 10%'.

[SunseraWarman]

Originally Posted by House of Tan

This is a hair and tanning set up. You are reffering to indoor tanning in general with the 'Less than 10%'.

yes exactly, and as being pretty much the only salon around we do get a great deal of business for that. Also get a ton of business for our massage as well

[delany]

I will be curious to see how your investment pays off! Any idea from your forecasting when your initial investment should be paid back?

You have at least:
8 hair salon
3 massage places
7 estheticians
In your area, that is a lot of competition for a small area. BUT you seem to be the only tanning salon, so that is nice!

[SunseraWarman]

we have predicted to have the investment paid off within 5 - 7 years completely. and as of right now there is only one other hair salon in warman. the others have moved or closed down and same with esthetics. there is only one other massage place still active in town

[delany]

Nice!

[Black Sun]

But still. only 9,000 people??
I have that many within my subdivision...that is not many people for such an investment. What is the age demographics for the 9k bodies? How many under 16yo, 32yo, how many over 50? Then divide that among competition..Not all would frequent such..
Still, IMO, no sense for such an investment. Sorry, I would not have done it...not saying its wrong...time will tell.

You did not list your overhead/monthly expenses in addition to any loans etc...

There has to be a reason all the other salons closed, and I can bet it was due to lack of business/interest.