How to Franchise a Salon in the US
Published April 24, 2023
Want to start your own salon business but not sure how to go about it? A salon franchise might be the answer to your needs.
Aside from getting the benefits of a strong brand, you also won’t have to start from scratch since a franchise business already has systems in place. It’s like the plug-and-play version of starting a business.
Not sure about how to acquire a franchise for a salon in the US? Here’s a quick guide for you.
How Does Franchising Work?
In a nutshell, franchising is paying an existing business for the right or license to use its brand, trademark, products, services, and processes.
There are two parties to a franchising agreement: the franchisor and the franchisee. The franchisor is the original owner of the brand, while the franchisee is the one buying the license to use that brand.
In most cases, the franchisor will also provide everything you’ll need to run your franchise as per their business model. This includes:
- employee training
- tools and equipment
- inventory
- business advisory services
- operational software
- marketing and promotional materials
For instance, let’s say you’re buying a franchise for XYZ Salon. You pay the salon owners a franchising fee in exchange for putting up your own salon that bears its name and logo. You can also sell their products or offer their services and use their business processes for your salon’s day-to-day operation. If necessary, they may also provide training to your employees.
In traditional franchising setups, the franchisee has to pay three types of fees to the franchisor:
- upfront fee for the right to use the brand name/trademark
- payment for inventory, equipment, training, and business advisory services
- royalty fee (usually a percentage of their sales or income)
Since franchising is a contract, franchising agreements have a fixed term. On average, they can last anywhere from five to thirty years. Though most of the time, they are renewable.
Why Franchise a Salon?
If you have the skills to run a salon but don’t have the business acumen, then franchising is for you. Here are some of the top benefits of a salon franchise:
1. No need to build your brand from scratch
As we all know, a strong brand promotes trust and customer loyalty. This is especially true in the salon industry. I mean, you wouldn’t entrust your hair or nails to a no-name salon, right?
However, building a brand from scratch can take time. Not to mention thousands of dollars in advertising.
With franchising, you won’t have to worry about building your brand from scratch. Most franchisors already have loyal customers. They’ve already built a reputation. Plus, in most franchising arrangements, all major marketing campaigns are usually done by the franchisor.
2. Business processes are already in place
One of the most tiring things about starting a salon business is establishing operational protocols.
For instance, you’ll need to have a system in place for booking customers. You also need to have protocols for employee training, scheduling, and hiring. If you’re not a seasoned entrepreneur, these can be very confusing.
As a franchisee, all you need to do is follow established business protocols. Everything is already set up for you, from the billing software to the client booking system. There’s no need for trial and error, making the business more efficient and reducing operational costs.
3. Access to business resources
As they’ve usually been in the business for years, franchisors already have lots of business resources. They already have a list of reliable suppliers, logistic partners, and bookkeeping firms, among others. Plus, they also know which licenses to apply for and how. All of these will be available to you, making it easier to start and establish your salon business.
4. Lower risk of failure
Since you don’t have to start everything from scratch, there’s less risk of business failure. Plus, they’ve already tested their business model in different locations. Meaning, they’ve already refined their strategies and processes to make sure that it works.
How to Acquire a Salon Franchise
Ready to make your first salon franchise? Here are some steps to keep in mind:
1. Do your research.
Though a salon franchise is a relatively safe investment, you shouldn’t dive head first. Do proper research first. Check franchise laws in your state and the viability of a franchise salon in your area.
Consider the initial investment you need to shell out too. Aside from the upfront franchise fee, you’ll also have to pay for:
- salon space renovations
- initial inventories
- equipment
- amenities
Doing the proper research can help you set your expectations straight and gauge how likely you are to succeed.
2. Look for salon franchising opportunities.
There are lots of salon franchising opportunities in the US. Each offers different services and business models. They also have varying levels of popularity and cater to different demographics.
To determine the ideal salon franchising opportunity for you, make sure to evaluate each of your options properly. Their franchising fees and information are usually listed on their websites. You can make a spreadsheet out of all those information to make a detailed comparison. You can also set down some criteria to help you narrow down your choices.
3. Review your franchising contract.
Once you’ve chosen which salon you want to franchise, you’ll be presented with a franchising contract. Never sign anything before you’ve combed through the contract and read the fine print. You can also ask your lawyer to have a look at it to see if there’s anything that may prove unfavorable for you down the road.
4. Look for a suitable space.
After finalizing the contract, you need to look for a suitable salon space. Most franchisors have particular requirements on the space size and location. Consider your target customers, too, as your salon has to be accessible to them.
If you’re planning to put up a salon franchise in Palm Beach, our salon suites will be perfect for you. Apart from its great location, it also has the amenities you’ll need to start your own salon business.
Salon Franchising Opportunities in the US
Not sure what salon to franchise? Here are some of the top salon franchises in the US:
1. Fantastic Sams
With over 800 franchise locations, Fantastic Sams is one of the largest salon chains in the US and Canada. They pioneered the concept of no-appointment, walk-in salons. They also cater to both men and women.
To acquire a Fantastic Sams franchise, you must have a net worth of at least $500,000 with a liquid capital of at least $100,000. The initial investment can also range anywhere from $150,000 to over $300,000.
Learn more about how you can open a Fantastic Sams franchise here. You can also check out their breakdown of initial investment costs on their site.
2. Great Clips
If you grew up in the US or Canada, you’ve probably had a haircut or have driven by one of the numerous Great Clips franchises. They specialize in no-frills, low-cost haircuts with no appointments needed. This “stripped-down” salon business model has proven to be a success since there are now over 4,000 Great Clips franchises across North America.
According to their investment breakdown, their initial franchise fee can be anywhere from $20,000 to $35,000. While the overall initial investment can cost up to $400,000.
Franchisees must also have a net worth of at least $300,000 with liquid assets of at least $75,000. They must also have a minimum credit score of 675.
3. Amazing Lash Studio
Unlike haircuts, lash extension services have less competition and higher demand. This makes them great business investments. Fortunately, Amazing Lash Studios is now up for franchise.
If you’re not familiar with their services, Amazing Lash Studio offers a full suite of eyelash care services such as lash lifts, extensions, etc. They also offer facial and beauty treatments as well as beauty products.
In 2018, the annual gross sales for their franchisees averaged almost a million dollars. They currently have 275 locations all over the country.
You’ll need a net worth of at least $600,000 to get an Amazing Lash Studio franchise with an initial investment of up to $700,000.
4. Drybar
If you live in a more affluent neighborhood, a Drybar franchise can be a sound business opportunity. Drybar offers premium hair styling services in a luxurious and relaxing environment.
Note that they don’t offer haircuts or hair colors, only hair blowouts. Think of it as a spa day but for your hair. Their services mainly appeal to younger working women looking to feel refreshed and take a quick break from their busy schedules.
Their initial franchise fee is on the pricier side at $50,000. While the total estimated initial investment starts at almost $600,000.
5. Seva Beauty
No salon or spa working experience? Seva Beauty’s franchise might be more suitable for you.
Seva Beauty offers a full suite of salon services from facials to brow shaping and makeup. All of their services are designed to be performed in 15 minutes or less, making them a pioneer in the concept of “fast and casual” spa service. Most of their locations are in malls and shopping areas. So customers can just casually drop in and get their brows, lashes, or makeup done in a few minutes.
They currently have 87 locations across 21 states. As per their site, you’ll need an initial investment of $80,000 to $237,000 including the initial franchise fee of $25,000.
Is a Salon Franchise Worth It?
It depends on why you’re starting a business and how much initial investment you’re willing to shell out.
If you’re an aspiring beautician who wants to get your name out there, a franchise might not be the best idea. You won’t be able to build your own brand and obviously, your customers won’t be able to associate your name with your salon.
The steep initial investments most franchisors require may also prove to be a setback, especially if you’re still starting. If you’ll put up your own salon, an initial capital of $10,000 to $50,000 will usually suffice.
However, if you want a faster ROI and don’t care for all the headaches that usually come with starting a business, franchising is the way to go.
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About The Author
Judy Ponio is the lead writer for the Salon Suites of Palm Beach website and blog. Her many years of blogging experience and passions for beauty trends helps her create content that has helped millions of people worldwide.
