glowgirl

Opening in June in a suburb of Houston, Texas. Closest competitor is 8.5 miles away. My space will be in a nice retail center along a major thoroughfare. About 90,000 cars pass by each day. Target market includes all neighborhoods, apartment complexes & businesses within a 5 mile radius = about 17,000 people & median income around $75,000. ETS beds, Eurowalls, spray booth (not sure which one yet), hydration station will all be in salon - 15 beds plus spray booth & hyd. station. This is a business venture my hubby and I are taking on as an investment - along with a womens' gym next door to salon. We currently own our own company in a different industry and pays all our bills and then some. Any profit from salon will be gravy.

Space is expensive because it is all new development - $22 per sq. foot. Starbucks, payless, Super Walmart, Chilis, Loews, Buffalo Wild Wings & more, all going in across the street and around my center. Some of my neighbors in my center are: a huge dentist office, sports bar subway shop and more to come.

We have $$ in the bank, but want to keep it there if possible. Borrowing from our bank - we have an excellent relationship with our banker. They do all of our other business' banking and all of our personal.

Does any of this sound good??? VERY concerned about opening in the middle of June, but on the bright side it will give me ample time to market the salon before January/February.

HEEEEEELP - need some candid advice from you guys. Cup half full....or half empty??

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GlowGirl
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sunsally

Any "investment" where you go into it saying "any profit will just be gravy" is silly. If it isn't going to be profitable, don't bother of course. Now - if you just mean that you won't have to LIVE off the salon cash flow for awhile, that's good. Most salons lose money the first year or two, and take until year two/three to break even or show profits.

Borrowing from banks where you have a good relationship is always good - tends to be the best rate. Don't be surprised however if your bank is less than warm to the idea of tanning. Historically, banks haven't done well loaning to tanning salons - they have not been a good investment, especially recently.

Generally, 10% of the population tans. If you have only 17,000 in the 5 mile radius of your salon, this would be 1700 potentials. This is a very small market and would be very hard to keep a 15 bed salon busy - or profitable. If you can pick up a lot more of that "drive by" traffic, that would help. But most people tan within a very short radius of where they work or live, so if they are just "driving by" on the way to get to those places and it isn't close - don't depend on them.

Houston is a very competitive market. Darque Tan is a formidable competitor. If this location is outstanding, expect them to move in soon. Their equipment mix would blow anything from ETS away.

Opening in June just means you will have to cash flow the salon even longer than usual. Plan on having 6-12 months worth of expenses in the bank and ready to shell out. Every slow season follows a busy season and vice versa, so the timing of when you open isn't a deal breaker, unless you don't have those cash reserves. June isn't generally a great time to be opening a gym either in most areas. Don't bother doing a lot of marketing during the slow season that is costly, as generally the ROI is very low. Focus on getting your name out locally and through word of mouth.

Overall, it sounds as good - or bad - as any other salon opening in today's market. The tanning industry is overall in decline, and oversaturated. There is money to be made, but generally it is being made by those that have been in longer, and operate from the advantage of lower rent, paid off equipment, established clientele, etc. Or multiple locations where their name recognition helps to drive their marketing.

Given what you have shared so far, and the current state of the industry, I'd say there are much better investments to be made with your money than a tanning salon. The "boom" years in tanning are long gone. However, I'm sure SOMEONE will open in that location- they continue to go up on every block. They may or may not be successful, but they WILL open.

If it is you - best of luck! Continue to read the boards and get as much education as you can before you open. Since you have until June, think seriously about leaving your equipment decisions and others "open" until you can learn/research more. "Gently used" better quality equipment would be an option I would consider.

Keep us posted -

Neon Beach

Texas? That says success right there.

BronzeBiz

Ditto on the ETS equipment. I think there are much better choices in equipment. I do use ETS Sunscape equipment and it produces very good profits. However, I would choose something different for your work-horses.

Bed maintenance is something that becomes more and more important as time goes on. How easy are lamp changes? How readily available are parts, etc.

Look at what equipment your competition has... you want to appear better to your clients.

Timing...June thru Jan. are breakeven months at best. So keep your staff lean. You should only need one staff person on at a time with only 15 units.

We feel that 18-24 units per location is optimal number for highest profits. Sure you can't squeeze in 3 more rooms? Even if you wait to add equipment till later? Just a thought.

Are you going to be able to get from gym to salon? Maybe during summer you could staff both with just one person, especially in the first 2 shifts? That would be helpful.

Good luck... we opened our first salon 3 years ago... 1 new one per year since then, and I love the business... but you have to prepare for JASON! (july,aug,sep,oct,nov) It will put a lot of new salons out of business.

PM me for any specific questions, and ignore the way negative comments on here. Since you are already a business owner, you have a lot of experience that will help you be successful.

GOOD LUCK!

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Neon Beach

Investment eh? And here I and other salon owners are actually trying to feed our families from this.

sunsally

That is an investment as well Neon - you are investing in a job that you hope will pay better than other alternative forms of employment.

Glowgirl the Texasnewbie is just saying they have backup cash flow. That is critical. Most salon owners don't think about that, and are sorry later.

billable

an investment SHOULD produce a return on that investment (income). If you work in the salon, you SHOULD be compensated for your time at a rate equal to what you would have to pay someone else to perform that job.

So, any business investment SHOULD pay you for your time and also give a return on your investment.

Neon Beach

Let's just say I wish I had my real job back.

SunEtc

SunSally sooooooooooo smart--Neon smart but has nothing better to do HA HA
I have been thinking of selling and building mini storage units. Is anyone with me?

KnxTan

Make sure you have ample parking.

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