Full Financial Break Down. How does this look? Will I survive with this plan?

[wanderlusttan]

For your first year, at least, you need to do a month by month revenue, you aren't going to start with 100, 300, 500 members. You will start with 5, the next month maybe 10, and keep building up. And that's with great sales people that know how to get EFT members, it's a lot harder than you think and I've done it for a fitness center and tanning salon. My salon is only spray tans and I was able to be profitable after only 2 months because I could start in a very small location and build quickly rather than having to worry about needing a larger location and worry about the overhead. I think more people should think about sunless only, not because there is anything wrong with beds, but there is more money to be made because very few salons are doing only sunless, buildout is way less, even a GREAT buildout with a full shower setup for easy cleanup, and you can add other things like eyelash extensions or an esthetician for skin care. You can even start that way, and leave room for a bed or two for those clients that want a bed package and then move up into a bigger space when you are profitable.

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[MKTans]

I purchased a struggling salon in January. When I worked my business plan I based my numbers heavily on the seasonality of the industry. The weather so far didn't agree with me- the season took off early and traffic is down in June- but sales are up so I feel like we are making headway! They are voting with their pocketbooks. Maybe your mentor can give you an idea of what to expect month to month? For me, January, August, October, November and December have been or will be dead! I knew this so while my sales are up- I am saving for the slow times. By having an idea what to expect you can better prepare. Example- don't replace someone if you lose them right before the downturn, tend to the personal stuff before you have to work the majority of hours to reduce payroll. Take advantage of lotion sales when you are busy so you have stock when it slows down. Good luck, as always these folks give great advice! I have read hundreds if not thousands of hours worth of posts and have notebooks worth of notes that I am in on a regular basis.

[indulgence1]

START-UP COSTS

The cost of opening a tanning salon depends on many variables. The costs of a new 2500 to 3200 -Square-Foot, 21 Bed Location as follows:
FRANCHISE FEE – $30,000
SALON BUILD-OUT/LEASEHOLD IMPROVEMENTS
$120,000 - $265,000

Your actual cost will depend on materials, square footage, layout, fixtures, number of landlord-provided tenant improvements, and the construction manager and vendors you hire to complete the work.
TANNING BEDS/EQUIPMENT
$158,000 – $310,000

This range is based on our recommendation of 2-3 super high-pressure beds, 3-4 medium-pressure beds, 5-6 conventional and one sunless Spray Booth. Typically this cost requires a down payment allowing the balance to be financed.
ADDITIONAL – $138,696 - $219,850

This can include such things as prepaid rent and security deposit, POS systems, professional services, utility deposits and permits, Grand Opening marketing and advertising materials, initial training, satellite music, security systems, insurance, lotion orders, supplies, furnishings, washers and dryers, working capital, etc.

$850,000

[BuyersGroup]

Dont forget the 6 mil in operating operating cash just to be safe

[Steve Underhill]

Originally Posted by MKTans

I purchased a struggling salon in January. When I worked my business plan I based my numbers heavily on the seasonality of the industry. The weather so far didn't agree with me- the season took off early and traffic is down in June- but sales are up so I feel like we are making headway! They are voting with their pocketbooks. Maybe your mentor can give you an idea of what to expect month to month? For me, January, August, October, November and December have been or will be dead! I knew this so while my sales are up- I am saving for the slow times. By having an idea what to expect you can better prepare. Example- don't replace someone if you lose them right before the downturn, tend to the personal stuff before you have to work the majority of hours to reduce payroll. Take advantage of lotion sales when you are busy so you have stock when it slows down. Good luck, as always these folks give great advice! I have read hundreds if not thousands of hours worth of posts and have notebooks worth of notes that I am in on a regular basis.

Salon operators have always been very good at identifying which months are likely to be slower months. Here is where the problem begins for most salon owners. Rather than developing plans to reduce the downturn in business or as I like to encourage, increase sales during those months, most operators simply stop operating during those months.

People tend to believe that you operate differently during peak months than during slow months. The smart operator has a business model that links all of these seasons together. A plan that based on what you do during peak times creates momentum through slower times to reduce the slump and actually make the peak times more productive. These business models are what sets the thriving salons apart during even the most trying economic times. Never assume when you will and will not do business. Create a business model that drives business year round with normal peaks and valleys based on consumer routines or trends.

An offensive business model will always generate more success than a vague method of operation that prepares for failure.

[toasted1]

Originally Posted by engfant

Hot Dog Stand.

everyone loves hot dogs

Why not a strip joint?

[BuyersGroup]

Owners that modify with seasons are few and far. Most times I discuss strategy with an owner the eb and flow are lost.

And generally speaking if your slow months lose money your in serious trouble.

[engfant]

Originally Posted by toasted1

Why not a strip joint?

That's what I said a hot dog stand.

[Black Sun]

Demographics suck...sounds like a 'party atmosphere', lot of 'bars'...sounds like a night time activity..dead during the day...people will not tan, prefer to spend $$ on drinks and getting drunk..and there is another problem..drunks coming into the salon...vomit and pi$$ in all the rooms...there is a reason no salon has ever existed there...

Open a Yoga Studio...it is the 'new salon' of the future.
Better public/govt perception of 'health'