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Old 04-05-2006, 11:50 AM   #1 (permalink)
 
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I know you have probabaly heard this before

So please dont' flame me. I realize every situation is different, location, demographics, marketing, etc etc, but I am just curious realistically, what kind of operation would you need to run to create > $100,000 net profit margin.

I am just wondering becuase trolling these boards you would think it was nearly impossible to make serious income from a tanning salon, and I have been researching this for over a year now. I would liek to do some thing coming up this fall if at all possible, but I was just wondering what I would need to do to make a decent living off of it. I am in Attleboro, MA, the area had decent competition (2-3 salons per town) but most salons are small and have < 5 beds and are not kept up very nicely atall. I think there is a lot of potential in the area.

So, I guess I am wondering if you would need 10 beds, 15 beds, or more? to enable revenue growth to 100,000. I don't want to make it any more complicated than that.

And FYI before I get flamed, caus'e Iknow I will likely get some righteous answers here, I have an MBA in entrepreneurship and have run my own web design firm for > two years now plus have several years experience in project management.
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Old 04-05-2006, 12:01 PM   #2 (permalink)
 
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Re: I know you have probabaly heard this before

Oh, and by the way, thanks and I look forward to your input and being a part of this community! ( I didn't mean to leave that out!)
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Old 04-05-2006, 12:06 PM   #3 (permalink)
 
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Re: I know you have probabaly heard this before

100K net profit? When you find out let me know. :lol:

Location is important, good luck. :)
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Old 04-05-2006, 12:08 PM   #4 (permalink)
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Re: I know you have probabaly heard this before

Me too!!! I can only speak for my region, but I don't think making 100K net profit would ever be possible with a tanning salon. Only with a large diversified business this would - maybe - be possible...
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Old 04-05-2006, 12:13 PM   #5 (permalink)
 
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Re: I know you have probabaly heard this before

Wow, that tough, huh. So you would theoretically need to run a couple to make some serious money. I am just wondering, becasue right now @ my job I am earning roughly $66k and I would gladly sacrifice some of it to leave, but I would really like to make at least $45k and in a couple years be significantly higher than that.

I'm getting quickly discouraged ;) Maybe i should try that German resteraunt my father keeps telling me he would invest in :)
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Old 04-05-2006, 12:14 PM   #6 (permalink)
 
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Re: I know you have probabaly heard this before

What about adding services? I.E. a tanning salon w/ hair & nails ? My fiance' would love that lol
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Old 04-05-2006, 12:16 PM   #7 (permalink)
 
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Re: I know you have probabaly heard this before

Massachusetts? Good luck. You can generate $100K of revenue with 6 beds...not straight out profit though. You will not make $100K net profit with a tanning salon unless you are the best of the best of the best.

I'm also a web designer, with a BSBA from UMASS. I can only assume from your web business that PEOPLE ARE CHEAP *** FOOLS and in tanning, they are even WORSE.

Some people could GIVE A FLYING F what you have or who you are. If it's more than the $25/month they are willing to cough up, they will move on to the next lowballer.

Lotion industry is going to CRASH AND BURN SOMETHING AWFUL. It's oversaturated, and 90% of it sucks.

Expenses are THROUGH THE ROOF and people want DEALS. And I'm not talking about broke *** fools driving 87 toyotas, I'm talking about douches that drive 100K SUVs and walk into your place looking for a DAM HANDOUT.

And let's not forget hiring quality help. NON EXISTANT to say the least. These frikkin low lives want $15/hr to do NOTHING. Not willing to learn, not willing to do much of anything.

You also have to remember a place like Attleboro may not even have a building that can handle more than a smaller studio like salon. If they are sill on septic, forgetabout installing a washer/dryer. If the building only has a total of 500amps of electricity, GOOD LUCK getting the land lord to upgrade it for you. We are talking 10s of thousands of $$$.

And where there is a lack of electricity there is a lack of air conditioning. That'll cost ya about $1000/ton and you'll need about 20tons for a 10+bed salon.

Bottom line, you are better off finding a place that some fool paid huge for the buildout and is unloading to make back the money in a hurry.
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Old 04-05-2006, 12:29 PM   #8 (permalink)
 
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Re: I know you have probabaly heard this before

Well I think first it depends on many degrees of factors.
Where you live? Growth of the current pop.? and Basic demographics. As much as people like to think this appeals to a younger group... truth be told ages 25-45 pay the bills, and for them convience is key.
Over head? I run my salon 95% solo. I rent a space to a massage therapist and she works occasionaly, and I have one part-timer who is a relative (that changes many things), we also just picked up an 18 yr old that will be cleaning beds on one of our busiest afternoons in exchange for tanning. Me working the salon cuts some of the big things out. I also bought preexiasting so I had clietnele to work with as well as equipment (it sucked but it got me by)
Maintenece Men-don't pay someone to clean what you can do yourself.
Places like texas rent is less expensive so you are able to have more equipment to start. California rent can be very high. I have 6 beds. I could use 2 more during busy hours.
I think it is possible to make money in this business if in fact you are wise about location, realistic about what things cost vs. what you truly need, and overhead. The less you spend to start the more profit in your pocket. I will not disclose openly what my finacial advisor projects for my earnings for the yr. but I will say my expenses meaning EVERYTHING is $3700 a month.
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Old 04-05-2006, 12:30 PM   #9 (permalink)
 
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Re: I know you have probabaly heard this before

Wow, Mike, I appreciate the honesty! In web design, I probably am rejected on 3 out of every 4 proposals over price, but I very rarely cave in anyways.

I just know there are a lot of crappy salons in the area and I would be willing to bet I could do them one better.

Is there a good website someone could reference me too for costs? I saw a breakdown at one point that had everything outlined for fixed and variable costs, of course it was an estimate, but the most accurate I have seen, i.e. each bed = xx electricity per xx minutes average customer is xx minutes costs xx a/c units, etc.

What is prime season, by the way? Late winter / early spring, getting ready for summer?
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Old 04-05-2006, 12:30 PM   #10 (permalink)
 
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Re: I know you have probabaly heard this before

Crap sorry that was not suppose to do that tech error on my part
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