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09-18-2010, 07:06 AM | #1 (permalink) |
Join Date: Sep 18 2010 Location: Southern California
Posts: 17
Rep Power: 0 | Need HELLLLPPPPPP Questions about Square Footage and Lease costs We need any input that many of you have learned through your vast and appreciated experience. I have been looking at salons for sale and seem to be leaning towards doing a start up. We are in southern California and the lease rents are crazy. We have done all the demographice etc and have narrowed it down to two locations. the first on is 1,400 square feet but the dimensions are 37' X 38', kind of a box shape. Concern is the usable space and how many beds we can get in there while maintaining space in fron for boutique clothing. Second space is 1,675 square feet, I don't recall the dimensions but is is longer and narrower. The big problem is this... the rent is $3.00 a square foot per month PLUS $ .70 cents a square foot for Triple NET (NNN) = $3.70 total per sq ft /mo. Salon 1 = $5,180 a month just to turn a key in the door Salon 2 = $6,216 a month " " " " " " " " How many tans would I need to generate per month just to put a key in the door? ... not to mention even taking into consideration the AC costs, Electrical, salaries, etc. IS it worth even considering this venture? Thank you all in advance for your input. It is very much appreciated. Dana |
09-19-2010, 07:37 AM | #2 (permalink) |
"The Man" Join Date: Mar 4 2003 Location: ohio
Posts: 4,015
Rep Power: 23 | Re: Need HELLLLPPPPPP Questions about Square Footage and Lease costs I would NEVER pay that much in rent. everybody screams location location location. Simply not true. I have 5000 sq and pay 2k Location does not build the biz....... The person running it does. |
09-19-2010, 07:43 AM | #3 (permalink) |
Join Date: Sep 18 2010 Location: Southern California
Posts: 17
Rep Power: 0 | Re: Need HELLLLPPPPPP Questions about Square Footage and Lease costs Thanks Rob, I agree that the rent is expensive... but remember we are in South Orange County CA and the rents are always going to be high here. What I am trying to figure out is how many tans would I need to generate to just cover my rent? I am trying to figure how many people I need coming through my doors each day and if I should just look at another line of business. Thank you for your help. It is appreciated. |
09-19-2010, 08:10 AM | #4 (permalink) |
"The Man" Join Date: Mar 4 2003 Location: ohio
Posts: 4,015
Rep Power: 23 | Re: Need HELLLLPPPPPP Questions about Square Footage and Lease costs Figure your total cost for 1 month of operating. Include everything, rent-labor-electric-insurance....... and so on. Divide it by 30 days to get per day cost, then divide it by hours you intend to be open. Then calulate the number of poeple you can put thru per hour x cost per session. With my total cost, I'm unhappy with less then 80 a day. Bob |
09-19-2010, 11:52 AM | #5 (permalink) |
Join Date: Sep 18 2010 Location: Southern California
Posts: 17
Rep Power: 0 | Re: Need HELLLLPPPPPP Questions about Square Footage and Lease costs You get 80 people per day coming through? If I could get 80 people on a daily basis I would be happy. What is the avergae cost per session? Dana |
09-20-2010, 07:51 AM | #7 (permalink) |
Join Date: Mar 5 2008 Location: Ga
Posts: 156
Rep Power: 17 | Re: Need HELLLLPPPPPP Questions about Square Footage and Lease costs There is no way I'd pay that much rent.... If you're per tan average revenue is $5 you'd need to see 35 to 45 people per day just to make rent. Then you have to account for power, employee, taxes, supplies, insurance, utilities, debt payoff, and any other fees to run a business. You'll need to see 50 to 70 tanners a day EVERY month just to make ends meet. That should be easy during the 4 month busy season. After that... |
09-20-2010, 09:01 PM | #8 (permalink) |
Join Date: Sep 18 2010 Location: Southern California
Posts: 17
Rep Power: 0 | Re: Need HELLLLPPPPPP Questions about Square Footage and Lease costs Thanks for the input... unfortunately that is the going rent in Southern CA... Everywhere... There are other salons that are paying more, (they signed leases before the economic collapse) and they are keeping busy. I too look at the numbers that one has to have and it is astounding and makes your head spin just to cover your nut every month. I was told that the avg cost per tan here was $8. |
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