Do you want to open a salon?
 

I have posted this before but since I am reaching a different audience here I thought I would post it here too and see what kind of feedback it gets and just to let the Newbies know what they have ahead of them and if they have thought really hard about what they are getting involved in and the costs of doing so.

Sure, this industry is a lot of fun but it is a real industry and you are going to be running a real business. Are you prepared to do so? Do you know what it takes to run a business? Opening a salon is NOT a, "Build it and they will come" type of business and it is extremely seasonal. You will make the majority of your money three to four months out of the year that will have to carry you through the rest of it.

Anyway, good luck for those that are seriously considering taking the plunge into business ownership and specifically owning a tanning salon.

Research your demographics and the amount of salons in your area. Saturation is a big factor. Can the area you are looking at support another tanning salon?

Someone sent me an E-mail looking for some advice. I thought I would post it here too.

Here's my reply:

Well let's see,

First off, electric upgrades cost lots of money. An overhead service upgrade can run 8 to 15 thousand and if you have to trench a parking lot to go underground you are looking at 20 to 40 thousand just for electric.

A/C will run you about 15 to 20 thousand for about 10 tons.

These two upgrades will chew about a third of your budget right there. Always try to negotiate these things in your lease as they are upgrades to the landlords property but you may end up paying for a good chunk of it depending on how negotiations go.

An HP bed will tax the electrical service for 100 amps three phase and 3 tons of A/C alone to run properly and the cost of a bed like this is in the 40 thousand dollar range.

Large VHR beds will need 60 amp three phase and 1.5 to 2 tons of A/C. Beds like this cost in the range of 20 to 35 thousand dollars.

Your smaller beds will consume about 30 amps to 50 amps a piece and need 1 ton of A/C and be in the price range of 5 to 15 thousand dollars.

Now we are approaching that $200,000 budget and we haven't even started the build out yet which can run 75 to 150 thousand dollars for construction costs.

Next is the timer and computer system, sound system, security systems, furniture, retail stock, and dozens of misc. items that you will need to purchase to complete the package.

Now that we invested about 300,000 dollars we need to advertise. Now keep in mind that this business is seasonal with three to four good months of moneymaking. The rest of the time you sit around bored off your a$$ with no customers coming in still having to cover rent which is in the range of 3 to 5 thousand a month plus other basic expenses. If you decide to lease all of the equipment you are looking at paying large sums of money per month on top of that all the while when there are no customers coming through the door. If you open in the off season, you will struggle to stay alive which will take even more money to make it to the first busy season.

It can cost on wards up to 10K a month just to break even before you even start to make a profit and that doesn't count payroll for employees if you decide to work all the shifts at 80 to 100 hours a week.

The season is typically from Jan. to June with Mar. Apr. and May being the best months so you need to stockpile money to cover those expenses in the off season. Now if it is your first year, you better have a fat bank account to pull you through or you are done. Figuring how many hours you are open and calculating your income based on the beds being full from morning until night 24/7/365 is unrealistic. These distributor projections are nonsense. They are designed to show income potential and not actual revenue which will be much lower. Just a sales tool for the bed distys. Pipe dream numbers for naive.

You need deep pockets to open and run a business like this. The industry is getting harder and harder to compete in and the cost of opening a salon continues to grow. Labor and materials continue to increase. If you are going to lease everything and milk every line of credit and put your house on the line are you prepared to live in a box under the bridge if it fails? More salons are failing today in record numbers. The boards are filled with used equipment and salons for sale or liquidation. It never used to be like that.

Think long and hard if you really want to do this. There are other businesses that are more profitable and worth investing in today that don't require as much capitol and still generate nice year round income. Competition has really set in and it makes it tougher to split the pie up among all of the other salons cropping up.

Banks have taken a beating too in the recent past due to saturation and the high failure rate that has blanketed this industry. It will get tougher and tougher to get financing for this too since a lot of financial institutions have gotten burned.

I hope this advice gives you some insight.

Re: Do you want to open a salon?
 

Maybe you can give me some advice...I am starting to freak out a little bit.
I am just about to buy a salon, and expecting to take over starting Dec.1-09
The salon is pretty basic, nothing fancy, meaning they haven't done a lot with the salon...it has 10 beds- 4-100 watt 20 min beds, 5-160 watt & 3 facials, 1 - Sun-Up 160 watt....
I am raising the price on the 160 watt beds by $2.00 at the start of the new year...they have them all the same price right now? I am trying not to make any drastic changes right off? The salon does need some slight touches, pictures, mirrors, rugs etc....any ideas on how to make the transition of new owners easier? Should I expect a huge decline? Should I offer a new owner special of sort? How can I make sure that I will keep these clients and draw in more?
I am sure that all of these questions will be based on my management but I guess mostly I am just looking for some advice...any words of wisdom?
Thanks for any ideas...

Re: Do you want to open a salon?
 

I wouldnt start off raising prices right away till people see the changes, I actually lowered mine when I took over.

Re: Do you want to open a salon?
 

We just started a tanning salon, and we didn't spend a fraction of what Oshman has mentioned... Of course we are not as big as Palm Beach or Club Sun but we do give personal feel and our customer base is loving the person to person feel we give them. We even get customers that had a bad experience at the bigger places I mentioned. We ran a good special for grand opening and run xx% off lotions.

I agree Don't raise prices, but advertise the 160watt beds as TURBO as they should be. TURBO=160Watt=More Power=Better Tan

You did say they were charging 100watt bed the same as the 160watt beds right?
If so I would change the way its advertised... keeping that old price for the 20min bed(100watt bed) and Turbo at what ever you see reasonable...

Re: Do you want to open a salon?
 

Yes,they are charging $7.00/tan for all beds except an upgrade which they charge $11.00/tan
I am definately going to change the way its advertised by switching to the level way of advertising...100 watt bed= level 1....keep that price @ $7.00
then 160 watts= level 2.....change this price to $9.00
and then their "upgrade" which is a 160 watts also but it has more bulbs...can I call this a level 3 and just leave the price at what they have it at, which is $11.00.
Or should I lower that to the level 2? And then eventually work up to bringing in a new bed at level 3?
What do you think of this?

Re: Do you want to open a salon?
 

sounds good if your clients are willing to pay by the tan. We are in a shopping center where people want month memberships, of course we get a few that get a single or 5 or 10 tan deal, but mostly mem's. We have our 100-watt at 27.99 a month and 160-watt TURBO bed at 69.99 (discounted for events and students)
I guess the general idea is getting members and creating a customer base that is consistent month to month. What do you charge for a monthly membership or do you offer that?

Re: Do you want to open a salon?
 

we also offer package deals, never tricking the customer into a contract with fees out the ***... Thats what we have heard from several customers...they don't like being locked in.

Re: Do you want to open a salon?
 

Right now they have monthly specials and then packaging...like 6 for $30.00 or 12 for $50.00....so I plan on having close to the same, with packages for each level...and then monthly specials too...I don't want to change too much of it...just the price on the 160 watt beds...I do think that the start of the new year would be a good time to do this and maybe just come up with a great package deal to help ease the discomfort, but I do think people will like knowing the difference between the beds...I know I do.
Thanks for your advice...:)

Re: Do you want to open a salon?
 

My post is to outline the startup of a top notch high end salon. Your mileage may vary of course but it is an accurate assessment.

As for the advertising of "Turbo", "Mega", "Ultra", "Super Ultra Mega Turbo",....STOP!!!!!

This is the dumbest concept you can do. What you do is generalize your beds with all of the other uninformed competition and you will just have customers comparing pricing by names that you give the beds that all of the bottom feeder salons use.

Call the beds what they are and explain the type of tan and the amount of sessions needed to get there. The customer doesn't care nor understand anything about wattage, UVA, UVB, etc...what they will understand is that if it takes 20 sessions on your base bed to get tan and 10 sessions on your VHR bed to get tan and 5 sessions on your High Pressure bed (you know, the bed that has all facials :rolleyes: ) and VHR tube beds ARE NOT HIGH PRESSURE, OR MEDIUM PRESSURE!!!!

Now, you sell from the top down. You explain to them that you only need less sessions on the better beds so that will equate to less visits to the salon and they will actually spend less money since they will have less expenses as far as fuel and travel and they will waste less time to get great results.

They will be saving time and money but a 25 to 30 bucks a pop you will be making more money overall when you keep the good stuff filled with bodies and you can do it with less beds since they don't need to be used 20 times a month so they are open for more people overall to utilize your establishment and it is more people to have an opportunity to sell to which is how you make more.

They will use less lotion and products but you will be selling to more people so you will be moving more product and you will not work as hard to make more money.

Also, the better beds do not have the harsh portion of the UVB spectrum, they will have more UVB but they will also have more UVA too. High pressure beds will not dry your skin like the base beds with high B fry baby lamps in them so your skin does not exfoliate as fast and the tan lasts longer and look better.

Also, forget the term, "Percent UVB". This term means nothing as far as true tanning power and if you don't use meters then you have even less clue as to what a percent of anything really is. See, the real way to measure output is in mW/cm².

Now, let's say that I have a lamp that puts out 25 mW/cm² A+B (total UV) and has an output of 1 mW/cm² B (UVB only) then the percent UVB is 1/25 = .04 x 100 = 4% UVB.

Now we have another lamp that has an output of 50 mW/cm² A+B (total UV) and has an output of 1 mW/cm² B (UVB only) then the percent B is 1/50 = .02 x 100 = 2% UVB.

Which lamp is stronger? Is it the 2% or the 4%?

Well it is the 2% UVB because we have all of the facts and not just the marketing hype. The UVB output between both lamps is EXACTLY THE SAME!!! Which is 1 mW/cm² B. The second lamp however has twice the UVA which will tan much better. You will get much more browning power out of lamp 2 even though it calculates out to less "percent" UVB.

Are you starting to see why this percent value is bull$h!t and misleading?

A reflector lamp will intensify the UVA which is what you want for a "real tan", not a reddening, fast fading one. Both lamps have the same exact UVB level and enough to get the melanin activated in your skin but the second one has the power to turn that melanin brown and get what is it we are selling? That's right, a real, long lasting tan.

So, the next time you hear that a lamp is Blah, Blah, Blah "percent UVB", then ask the question, "percent of what?"

As for what to do with your place, clean it up, re-lamp the whole place with some kick a$$ Supra® lamps. Add some new machines and raise prices. Do it right off the bat. Don't wait and just float along with the same old formula that is there now, that is the reason it is for sale, because it is slowly losing money. You need to invest in it or it will just die.

Put in a couple of real nice high end beds and a high pressure bed. As I said before, you need to sell from the top down. Yeah, the customers that use it will come in less individually but collectively you will be taking in much more revenue and you want the high end beds full and running. This is the level where you make your money.

DO not fall into the trap and believe that you cannot make money on high end beds or that your area will not support it because that is crap. High end beds work everywhere. It is the difference of whether or not you are a sales person or just a mere clerk chimp pushing the buttons up front.

Always tell the customer what they need, never let the customer decide on session time length and things like that. You are the boss.

Getting back to the high end beds, put some in and start making money. Raise the prices and give them new options. Some will leave but that is OK. The ones you keep will be more satisfied and a better salon will bring in better clients that spend more money. DO not bother upgrading the base beds first. They are not your money makers. Full base beds does not mean you are busy making money, it means that you are busy working harder to make half of what you can make in a quarter of the time with better equipment.

OK, now get to it. Class will resume at a later date.

Re: Do you want to open a salon?
 

Well not all of us can afford to buy/start a biz then add brand new equip... We Fix up what we bought and update..
Not everyone likes the highend places for that very reason, high prices passed to the customer...

Re: Do you want to open a salon?
 

You can get nice high end beds used too which will give you more value.


What exactly does that statement mean? That's like saying not everyone likes filet mignon and lobster, some just like eating dog food. :rolleyes:

Also, His and Hers Tanning, you need to stop giving out advice. It is not very business minded. You want high end equipment, you want EFT contracts, you want people that spend money.

You do not want bottom feeders, you do not want to let the tail wage the dog, you do not want month unlimited, you do not want minute packages.

Re: Do you want to open a salon?
 

If you can't afford to do it right then don't do it at all.

Go big or go home.

Re: Do you want to open a salon?
 

Why would you not want to offer monthly unlimited?

Re: Do you want to open a salon?
 

Unlimited promotes irresponsible tanning habits and is not necessary with good equipment. This is what you trade out for contract EFT packages. EFT can and will get you through the slow times by spreading out the revenue.

Another definite no no is minute packages. Minutes are Death!®

Minute packages leave money on the table. Customers will stockpile and spread out their sessions by doing less time and then complain that they are not getting tan because they are not following proper tanning schedule by doing this.

Also, since they will stretch out a package and milk it you are in turn losing money because they tie up the room for more visits and they are not spending any money.

Minute packages were a tool when VHR beds first hit the market and no one believed that you could get a great tan in 12 minutes* so to start the buzz and market it the minute package was born. This allowed customers to buy minutes but actually go for the recommended schedule because you would have to start off at 6 minutes (average) on a VHR bed and customers thought they were getting ripped off when in actuality they were making out.

The amount of time you can go on a tanning bed based on your skin type and tanning progression is the full time. The time on the bed is the maximum time. 6 minutes the first session is not a half a session, it is a full session because you are receiving your full dose in that time period. A session is a session.

Now, by selling minutes the customer is still using the bed and it costs you just as much whether the bed runs 6 or 12 minutes or on a base bed 10 or 20 minutes. You have the same labor of cleaning it, the same laundry, the same wear and tear on the bed and lamps, and all the while you are making half the money doing it.

Selling sessions and points packages and EFT is the way to go.

Make your single session prices high and then offer packages that discount that price. That is what establishes the value. Don't make the packages directly reflect the single session price. You want to create a sense of value to purchasing the packages based on the single session pricing.

Points packages work like carnival tickets. You buy a sheet of tickets (points) and you can ride any ride (bed). The better more thrilling rides cost more tickets but you can use the package for any unit in the salon. Points packages are a proven way to maximize your revenue intake. The customer buys a set amount of points for a price and then they don't have to pay up charges to use the better stuff but it doesn't seem so expensive to them since they are not spending money each and every time they visit and will tend to use the better stuff because they already have points on file.

EFT is the program that pays your rent, your electric, etc... This is the package that you offer under contract. You do not formally advertise this one. You make it exclusive. This will have the best pricing as they are getting the cheapest pricing but have to make a minimum commitment to get it. This is offered to those that want the lowest pricing. You sell this with a contract and sign up fee. You make it seem exclusive and stress that there are only so many slots available and if they cancel then they can never get back on this program and get the best pricing possible.

You don't want all of your customers on this program, you just want enough to cover most of your expenses, then the rest of the customers are your real profit. The customer you want on this is the one that never comes in and tans. You make it low enough that they will not mind paying the fee. This type of package will include half price upgrades, discounted lotions, etc... It is like a club and to get the good pricing you have to be "in it".

*(but they think they can split 20 minute sessions into two 10 minute sessions on 100 watt beds and get great results but can't because customers are idiots and idiot salon owners allow this to continue)

Re: Do you want to open a salon?
 

Well in my opinion thats doing the customer wrong, shady! We do offer ETF packages, 3, 6month etc. but never am I going to tack on a fee for starting it. If I don't have to pay any extra fee then why should I pass it on to the customer...

What is your salons name, and where?

Re: Do you want to open a salon?
 

There is nothing shady about it. It is called making a profit. I guess you prefer to run your business as a charity. If you struggle to pay the bills then it is time to change the way you do things. You can't stay in business and make a profit by giving away the farm. The salon, and all of the responsibility belongs to you, not your customers.

When it comes time to maintain the equipment and pay the rent in the slow season if you are complaining and struggling then it is time to restructure your plan. If you enjoy leaving money on the table and giving it all to your customers and being broke then by all means just continue on with the money losing plan you are running now and don't bother asking questions on how to maximize your profits.

Failure is always an option. :rolleyes:

Re: Do you want to open a salon?
 

Instead of speaking out of your *** realize whats going on, I never asked how to or what to do. I merely responded to some one else's question. We run a salon without having a rip-off plan. Yes I'm sure your plan (no money left on the table) will be profitable, but we have had enough customers coming to us from big high priced salons. We don't plan on getting rich or breaking the bank. When commenting on your 200+k comment, I just wanted to say thats not true. Many of us do not have that kind of money and I'm sure you don't either! You seem to have allot of knowledge, but no experience in opening a salon. By no means am I trying to get into a ******* match, just seems as if We are in the middle of running a salon and you are selling tech/products.... So yeah if it weren't for people like us then you would be jobless...

So by all means send me a catalog of what ya got...

Re: Do you want to open a salon?
 

So whats your opinion on a special of 20 tans for $50.00?
We were planning on taking over a salon Dec. 1st and the owner has decided to run this special this month....leaving us to honor all these tans?

Re: Do you want to open a salon?
 

I wouldn't, half our monthly members come one out of three days. 30/3=10 @ 30$ a month. We come out better giving the customer unlimited (of course limited to one visit a day) if the customer has 20 tans then as Oshman would say "moneys left on the table".
In my opinion I wouldn't offer that.
Maybe 5 for 20$ so the customer can get a feel or a base tan for an event..(had a few do this)

thanks,
brad

Re: Do you want to open a salon?
 

No I am not saying I would do this....it has been done to us!
We were going to take over as of Dec 1st and now they have put on this special....therefore everyone that buys this special gets 20 tans that they can use whenever and we don't get any money for it! So they get the money and we get to honor everyones tans....just a little rude don't you think...it's actually a deal breaker- we are not going to take over when everyone has just purchased this crazy package- how will we pay our bills for the next couple months? I mean $2.50 a tan come on....and 20 tans...it could take some people months to use all those up...
Sorry I just felt like venting....I was really looking forward to buying this salon, and now we don't think it would be that smart...especially when they are saying they don't know how to find out how many tans are already out there, pre-paid...you would have to be an idiot to not want to find out wouldn't you?

Re: Do you want to open a salon?
 

I agree 100%... that would be Big Deal breaker! Specially when they want tell you how many or offer any comp. What the he'll were they thinking?

Re: Do you want to open a salon?
 

It is not a ripoff plan, it is smart business.

I am not saying that you cannot open a salon for less than 200k, in fact you can. I am however pointing out what a salon done right will cost.

As for experience, I am quite sure that I have more than a couple af days more than you do in this industry and I will never be jobless. It is actually the other way around, without me to build the salon and fill it with equipment and sevice it and supply you with the products and the knowledge that you need to be successful then you would be jobless.

Re: Do you want to open a salon?
 

Why would you honor these tans? This is why you negotiate. The current owner will need to adjust the selling price on the day of transfer to compensate for these kinds of sales.

The only time that you honor packages (and you have no obligation to do so but it will win over screwed customers) is if you take over a salon that has closed and the prior owner screwed everyone with midnight sales.

The other time you do it is when you buy a database. Of course if you buy the place you honor current packages, that goes without saying but you don't settle for a price and then let the current owner sell you under the table without compensation. If they will not adjust then you walk. It is standard procedure to square up at time of transfer.

This is easy to do as you just pull reports and go from there. If there is no computer and you are just going by word of mouth then that is suicide. Did you get current reports? Did you see the actual last three years of filed tax returns? (not the cooked books but the actual filed returns) This is what you base the purchase price off of, not word of mouth and not just the books. The tax returns are the tangible value. From here is where you negotiate the price and then move on to compensation for packages sold during the transition period.

Re: Do you want to open a salon?
 

So you come out ahead at 3 dollars a tan and no commitment?

Maybe bump it up to 4 bucks a tan?

http://www.tantoday.com/forums/galle...173_262451.jpg

I take it that you enjoy working 80 hours a week for minimum wage?

Why would you let customers tan everyday anyway? There is no need to tan everyday. The tanning process does not work like that to begin with. It is this mentality that is forcing the regulations that to Gov't. is sending down the pike more and more.

If you want the customers to get a feel of what you offer then you get them in the high end stuff and keep them there. Show them the real benefits of tanning in good equipment and only needing once or twice a week to maintain a great tan. You don't need to develop a base tan on the crappy little bottom feeder beds first in order to tan on the good stuff. That is just a myth.

Are you Smart Tan Certified? ATI? NTTI?

Re: Do you want to open a salon?
 

Yah thanks Brian...we have looked at all the books and the tax returns and we were in the final stage of negotiations when we caught this "special" and they are saying they aren't trying to "money-up"....ha
They have the Sun-touch system on their computer...they are trying to tell us that there is no way to find out how many tans/packages they have prepaid out there...
and we have said we need compensation then for these tans/packages they have sold this month on this special...I guess they thought they were dealing with dummies...:)

Re: Do you want to open a salon?
 

You can pull reports from all the packages that are active and you can certainly figure out what was sold since initial negotiations. Something smells fishy about that statement that they have no idea how to provide you with that information.

I would call Bull$h!t and let them come up with the actual sales and compensate or walk.

Re: Do you want to open a salon?
 

Thanks for the advice...thats exactly what we thought...and thats what we are doing...
I have a feeling someone might be learning how to use their computer system really soon if they really want to sell...:)

Re: Do you want to open a salon?
 

There's nodoubt they know, they are just acting dumb. You don't sell products and not know it... Yeah that's some bs

Re: Do you want to open a salon?
 

That is taking advantage and I would ask them to stop the sale pronto or you will walk away. I was in the process of buying a salon when the former owner extended the "buy one get one half off" points special, which is hugely popular. At closing I required 50% of the previous months point packages. I understood I was buying a salon that had prepaid services I would be honoring, no problem. When they were selling prepaid services that could not even remotely be used before the closing I got ******. The amount collected covered my costs of buying the salon. Fortunately I have done very well with that location.

Re: Do you want to open a salon?
 

Yeah it's obvious they wanted to get quick cash before you bought.

Same as Allenj we were going to buy a salon and snopped a little and found out they were lieing about their books, so we started our own...we ended up buying that persons customer list for pennies!
So needless to to say if it smells like fish it's probably fish(don't do it if they are being shady)...

Re: Do you want to open a salon?
 

Wanting to start a mobile business. What equipment is best? I keep reading that you dont have to spend much to produce the same tan. Any suggestions for a newbie? Also, has anyone used Organic Sun solution?

Any input is helpful...

Re: Do you want to open a salon?
 

Wrong thread. The Trunk Slammers® area is in the sunless forum downstairs.

Re: Do you want to open a salon?
 

My apologies, wasn't aware I had entered the jerk forum.

Re: Do you want to open a salon?
 

Ya know, I just gotta say that 3 years and a few months later, I really agree w/Brian's $ assessment. Just b/c you don't see it at the get go doesn't mean you won't be eventually paying it. I wish to god I would have had read that before I began my journey as I know I would not have done it. But here I am and I'm not going anywhere.

I have experienced almost every single thing he described in his original post and I just sat there w/my mouth open. Especially, as I became more successful (after starving of course and almost going under any second of everyday), then I completely ran outta room and voltage.

Coulda, Woulda, shoulda's aside, I sure have learned alot and would share with anyone who asks because I certainly wish I would have had someone to ask. I can say that it may sound like Brian is being mean and in the "we don't want you in our industry" club, but I would sincerely have to say that anyone entertaining the idea may really want to take note of that post.

Soooo, does anyone have tanning equipment in their bathroom because I'm flat outta room, locked in a lease and really, desperately need to expand. No body needs to pee right? :wink:

Re: Do you want to open a salon?
 

Hey guys, I'm reopening a closed salon in a large city and was just curious how the business is handleing the economy?

Re: Do you want to open a salon?
 

Business sux, don't do it.

Re: Do you want to open a salon?
 

You will be reclosing it soon! Best of luck to you. :)

Re: Do you want to open a salon?
 

There's a reason it closed, and that's the first hurdle.

Re: Do you want to open a salon?
 

Hey guys, I am looking for suggestions on a good places to buy merchandise to sell at my tanning salon: Jewlrey, handbags, sunglasses, hats and caps, flip flops....etc.

Re: Do you want to open a salon?
 

Try the local flea market.