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Old 03-09-2007, 01:25 PM   #31 (permalink)
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Re: does this salon investment sound good

I'm checking tantalk today -- waiting for jmiles to check back in -- I'm curious to know if he spoke with his famdamily about the expected costs and what their reactions were. I'll keep checking and hoping Brandy will blog for me again.......:)
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Old 03-09-2007, 01:45 PM   #32 (permalink)
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Re: does this salon investment sound good

Brandy is right. Dont do business with family and dont buy or sell them a used car for the same reason. You will only hurt the whole family in the long run and maybe even in the short run. Walk away and stay happy. Maybe they'll be upset at first but they'll get over it. Nothing is worse than losing family!
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Old 03-09-2007, 04:37 PM   #33 (permalink)
 
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Re: does this salon investment sound good

MY Brother has about 150k in available capital in the form of a line of credit. The build out is going to cost about 110k . That does not include the cost of the beds. They are going to have to lease the beds. Do you think that is enough remaining capital for them to make it on their own.
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Old 03-09-2007, 04:43 PM   #34 (permalink)
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Re: does this salon investment sound good

With that kind of buildout and only 7 beds you are going to need top of the line equipment which will easily cost $150,000. Do they have any idea how they are going to capture the upscale clientel this small salon will need or if those clients even exist in the market where the salon will be?
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Old 03-09-2007, 04:44 PM   #35 (permalink)
 
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Re: does this salon investment sound good

You are not comparing apples to apples.

Cash on hand and a credit line are two different things. I think I was reading about a guy that was able to get 950k on credit cards and jugle them. However he had to start paying intrest at one point.

This plan is so horriably thought out I don't know where to begin proceed and open in Mid July you should be good to go. I see your not taking any of the advice from us professionals?

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Old 03-09-2007, 05:02 PM   #36 (permalink)
 
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Re: does this salon investment sound good

Indeed all of your responses have opened my eyes.
I dont really know what kind of money a salon like this has the potential to bring in
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Old 03-09-2007, 05:16 PM   #37 (permalink)
 
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Re: does this salon investment sound good

It's under funded you have stated that. These people have not done thier homework it's more of question of you don't know how long you will be putting money into it not how much money will the salon make?


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Old 03-09-2007, 05:28 PM   #38 (permalink)
 
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Re: does this salon investment sound good

Quote:
Originally Posted by jmiles View Post
MY Brother has about 150k in available capital in the form of a line of credit. The build out is going to cost about 110k . That does not include the cost of the beds. They are going to have to lease the beds. Do you think that is enough remaining capital for them to make it on their own.

Oh god. If this is reality them I'm a trillionare.
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Old 03-09-2007, 06:43 PM   #39 (permalink)
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Re: does this salon investment sound good

You guys are right about everything but 150K for 7 beds? What beds are you buying?
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Old 03-09-2007, 06:49 PM   #40 (permalink)
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Re: does this salon investment sound good

A salon will cost roughly 275 thousand dollars to run and operate the 1st 2 -3 years - this 275 should include -- build-out, equipment, rent and payroll for at least 2 years -- I'm thinking of "upping my ante" on this cost thing and tossing out another 50k to make this an "at least" $300,000 -- when people spend between 200k and ~whoflippinknowshowmuch~ just to BUILD-OUT a space it can up this amount to a very realistic 400k.

Potential New Salon Owners Please know YOU gotta have LIQUID capital to pay rent and payroll while you build a client base -- 20, 30, 40k + months do NOT happen the first year and don't happen at all some months of the year. Often times it takes 3-4 seasons with aggressive advertising to see any light at the end of the no money tunnel . This industry is a long term INVESTMENT and a risky one at that -- plan on NOT reaching your break even point until year 2 (minimum) or year 3 (if new salons can make it that far). Hopefully -- if you are doing things right you should see some kind of a profit (regardless of how minimal) in year 4 or 5.

PS -- I agree -- a 7 bed salon can be nicely equipped for way under $100,000.
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