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Old 03-13-2012, 02:33 AM   #1 (permalink)
 
Join Date: Sep 19 2010
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Am I missing something?

This is really a write up on my experience in the tanning industry so far and if my thoughts are where they should be. Also if my business sense is where it should be at. Thanks for readings.

Basics:
In Fall '06 I started working at a tanning salon working 3hrs after I got out of school daily, which at the time I was 16. I worked my way up from making $5.15/hr to now making $8.25/hr. This is mostly due to the length of working there and the fact minimum wage has rose in the past 6 years. I learned sales from an owner that had the place for roughly a total of 9-10years from the time they owned it to the day in '09 when it was sold to the new owner. I learned pricing, dealing with customers, how to run the business and being the best I could be with the knowledge I had. For referrence, I actually work 40hrs/wk and make more salons then anyone else including the owner. I basically live up there. Not saying 40hrs is a lot however I am up at the salon more then the owner, and put in more effort. It has gone from an organized operation to a mess it seems.

Lotion/misc sales:
I have actually got a pretty good pricing with FS (50% off from salon cost). But most of the profit comes from the PunkyTan products we can buy for $5-$20 and sell for $35-$120. These products are a lifesaver and do sell themselves. Goggles are $10/ea. We offer Teeth Whitening which is hardly used, through the year there is an average of $15/mo made from the service. This is a waste in my opinion since the owner is not taking full advantage of the service. We offer red light therapy in the fall/winter months because slow season allows us to use a tanning bed for the bulbs. Not proper but its also not my decision.

Advertising:
LOL, which is all I really have to say. We mainly advertise by word of mouth. This is not as profitable as doing flyers, emailing, etc. This section is really not going to be dicussed because there is nothing to actually talk about.

Beds/Spray:
We have 6 Puretan beds, 1 Ergoline 600, 1 VHR, 1 VHO, and 1 Sunstar 432, and an air brush machine. These beds are old and all IMO lower pressure units compared to what is offered today. We changed all the bulbs in '10, which means its really about time for an upgrade again. I have been trying to get the owner to lease some newer units and get a mystic. The airbrush does make some customers uncomfortable because the owner is a guy. His wife does not enjoy the thought of spraying a nude body, nor will he hire a female to do so.

Memberships:
We have contract, EFT, units, and single month memberships. All monthly memberships range from $25-$65 + 10% tax. EFT: $25-$55. Contract: 4mo/$225-3yr $1100. Single months: $35-$65.

Specials:
We only offer 1mo for $20 for new customers only, and you must be over 18yrs old. I offer 20% off a lotion when you buy a membership, which I am the only employee that does this.

Conflict of interest?:
The owner actually sells security alarms which is a knock-off ADT type service. When he sells an alarm he does give out 1 month of regular bed tanning for free. I am against this completely but he has the final say. I think he puts more time into this then he does his salon.

My standing:
I have been there 6yrs (as of Sep '12). I manage the salon, make sells, deal with customers, and a ton of customers have told me they only tan at the salon because I am there. Many have told me to open my own salon. I have been told by customers that they dislike the owner, and if I left then they would end their membership at the salon I am employeed at. Not sure if this would happen but sometimes with watching my owner's business decisions I think that if I did leave the company would fail. I should think positive but sometimes it is hard... Last year I beat cancer (non UV related) and I am about to finish college. My dream is to become a law enforcement officer but I know this industry on a local level.

Competion:
There is 2 other salons in the town where we are located. One of them has 2 locations and has 15 beds. They are open roughly the same hours as us (might close 1hr before us on sundays). They mainly deal in EFT's and have beds that put ours to shame. This is no joke, while they run sundash, sondrome, silverbullets, sunboards, etc. Nice units for roughly $10-$30 more monthly then we currently charge. They carry higher quality lotions and overall have a nicer atmosphere then we provide. The other salon is very upscale with versa, all new ergoline beds, etc. I'm sure you get the picture. They charge $100/mo on average for all access. However if you "like" their FB page then you can buy 3mo for $100-$120 depending on the time of the year it is. About 3 weeks ago I had a customer tell me then wanted to charge $1000 for a year of all access so she came to tan at my salon instead.

So should I attempt to open a salon? Here is my plan.
I do not have a lot of money, which means everything I do would be from bank loans, hopes, and ambitions of owning a successful location. I would lease beds (15 total) ranging from regular Sundashes to top of the line HP Soltron units. I would also grab 2 mystic or versa units as well as a norvell airbrush unit. I would be carrying designer skin, Punky tan lotions, supre, AG, Devoted, and all the Jersey Shore crap. I would be on a TanTrack software to keep track of all my clients and sales. The town is very open mouth so just annoucing the openning of a new, "better than the rest" salon would draw more attention then a crotch shot of Brittany Spears... I would still advertise using email, FB, groupon, and other advertising sites. I believe if I have a good product/service and I offer it for a decent, not too high not too low, price and offer what everyone else does then it would be successful I think. I am probably getting in over my head but I have not looked into pricing and everything yet. I have not spoken to any investors or customers about this as it is a huge step in life. One I am not sure I am willing to take. I have looked into openning a Palm Beach or a franchise of a local salon but it is not seeming to be a smart investment. $350k-$750k to start and then pay a corp a monthly % of everything I sell... Seems ridiculous.

Thanks for the help everyone.
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Old 03-13-2012, 12:05 PM   #2 (permalink)
 
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Re: Am I missing something?

How much money do you have saved up at 22? Close to 300k? If not keep saving and apply for a manager position at all the salons you like and think are ran/built right. Dreaming is always good.
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Old 03-13-2012, 12:15 PM   #3 (permalink)
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Re: Am I missing something?

Quote:
Originally Posted by Matthew24 View Post
How much money do you have saved up at 22? Close to 300k? If not keep saving and apply for a manager position at all the salons you like and think are ran/built right. Dreaming is always good.
Matthew Matthew Matthew.................... Don't ya know she's taking over the tanning industrie !!
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Old 03-13-2012, 01:19 PM   #4 (permalink)
 
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Re: Am I missing something?

the best thing is to buy real cheap and go for it. It is possible to buy salons for pennies on the dollar for a variety of reasons that may have nothing to do with the salon itself. Divorce, drugs, lazy owners, etc. Get a place that's up and running for $10-20K and make it work.

You'll NEVER make your money back on a $100K purchase. $10K you can make it back in 3 months.
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Old 03-13-2012, 02:59 PM   #5 (permalink)
 
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Re: Am I missing something?

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Originally Posted by tanu01 View Post
Matthew Matthew Matthew.................... Don't ya know she's taking over the tanning industrie !!
Who's "she"? I'm a dude lol. Tanning salons in this town actually start at roughly $140k when they finally do come up for sale. Its higher end. However back in '08 when I graduated HS I was offered to buy this salon for $95k because the owner was going through a divorse, I highly doubt that opportunity will come again with the new owner. So, I would actually have to open my own and go from there. Has anyone ever gone through investors or partnerships?
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Old 03-13-2012, 04:51 PM   #6 (permalink)
 
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Re: Am I missing something?

How do you think you will get loans? Do you have assets to lien against? It is near impossible to get a tanning salon loan as well as bed leases without assets. The average salon is 300k build out I believe.

Can your town support another salon? what is the population etc?

Investors would be nuts to invest in a tanning salon. Partners lower your risk since someone else is involved but again would be nuts to do it. You also lose control since you have to refer to another person contantly.
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Old 03-13-2012, 08:23 PM   #7 (permalink)
 
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Re: Am I missing something?

The town has a population of 28k. I was hoping a decent business plan, experience, and my handsome looks would get me a loan but I really own nothing. 2 out of 3 salons are operating while breaking most of the rules the State requires you follow. It seems that openning a salon would be pointless unless you have stupid money to blow. It's sad because this town needs a salon that would provide customers with a better tanning experience.
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Old 03-13-2012, 08:39 PM   #8 (permalink)
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Re: Am I missing something?

This is all BS
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Old 03-13-2012, 10:32 PM   #9 (permalink)
 
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Re: Am I missing something?

Come work for me,
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Old 03-14-2012, 12:17 AM   #10 (permalink)
 
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Re: Am I missing something?

Quote:
Originally Posted by tanu01 View Post
This is all BS
Why do you say this?
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