Are you about starting a booth rental salon? If YES, here is a complete sample booth rental salon business plan template & feasibility report you can use for FREE.
Okay, so we have considered all the requirements for starting a booth rental salon. We also took it further by analyzing and drafting a sample booth rental salon marketing plan template backed up by actionable guerrilla marketing ideas for booth rental salons. So let’s proceed to the business planning section.
If you are interested in the salon business and looking towards launching a business as an aspiring entrepreneur, one of your best bet is to launch a booth rental salon business. The right time to start such business is now because this business concept is presently at its growing stage.
Booth rental salon is operated or owned by a person known as booth renter. Their responsibility is to lease space from a large salon or a suite of small salons to hairstylists, barbers and similar businesses who may not want to shoulder the responsibilities of owning a standard salon facility.
The booth rental method simplifies the financial aspect of owning a salon. All you need to do to run this business is to provide the space and charge each stylist a set amount for rent.
A booth rental salon business could be a fun, profitable and interesting for someone who is a contractor and has business perseverance and smartness. With the right location, top-notch facility and good marketing skills, you can accommodate top profile hairstylists and barbers et al who would want to run their business from a booth rental salon facility.
Starting up a booth rental salon business may not require huge startup capital, but it needs a significant investment capital, solid planning, and attention to detail in order to keep your business profitable. The bottom line is that if you are determined to explore the entrepreneurial world by starting a standard booth rental salon business, then you should consider going through the business plan below.
A Sample Booth Rental Salon Business Plan Template
1. Industry Overview
Booth rental salon business is part of the hair salon industry and the industry includes salons that primarily offer hair care services such as haircutting, hair coloring and hairstyling services. In addition, these companies may also provide facials and makeup applications (except permanent makeup) and retail beauty products.
The Hair Salon industry has managed to untangle its early post – recessionary bumps. Rising consumer sentiment and per capita disposable income have boosted industry growth over the five years to 2017. This has also led to increased demand for ancillary services relating to haircuts such as hair modification treatments (e.g. straightening procedures and perms), skin-care services and massages.
In the coming years, the industry is forecast to exhibit continued growth. Per capita disposable income and consumer confidence will keep rising as the unemployment rate continues to decline, providing consumers with more discretionary income for luxury services at hair salons.
The Hair Salon industry is indeed a growing sector of the economy of the united states of America and it generates over billion annually from more than 1 million hair salons (booth rental salons inclusive) scattered all around the United States of America.
The industry is responsible for the employment of over 1.4 million people. Experts project that the industry will grow at a 1.8 percent annual rate between 2012 and 2017. No player can boast of having a lion share of the available market in this industry.
Research conducted by IBISWORLD reveals that the Hair Salons industry is in the mature phase of its life cycle. Industry value added, which measures the industry’s contribution to the overall economy, is projected to grow at an annualized rate of 1.9 percent in the 10 years to 2022. Over the same period, GDP is forecast to increase at an average annual rate of 2.1 percent.
Therefore, the industry is growing only marginally slower than the economy as a whole, which suggests that the industry is mature. Additionally, the industry exhibits characteristics of mature industries such as stable long-term demand and minimum product innovation. Product innovation has grown at a relatively steady rate over the five years to 2017.
The booth rental salon line of business is very open to any aspiring entrepreneur who has the capacity to open and run his or her booth rental salon. Just ensure that your booth rental salon is located in an environment with the right demography and you will be fine.
2. Executive Summary
Estee Jones® Booth Rental Salon®, Inc. is a licensed booth rental salon business. We have been able to secure a standard facility in a central and busy district in Colorado Boulevard, Pasadena – California.
We are a booth rental salon company that is set to compete in the highly competitive and fragmented hair salons industry not only in Pasadena – California, but also throughout the United States market because we intend opening our booth rental salons in key cities across the United States.
Estee Jones® Booth Rental Salon®, Inc. will run a world – class booth rental salon. We intend to lease space to hairstylists, barbers and similar businesses who may not want to shoulder the responsibilities of owning a standard salon facility.
Our business goal is to become one of the leading booth rental salons in the United States and we will make sure that we do all we can to compete favorably with leaders in the industry. Our workers are going to be selected from a pool of certified, creative and highly experienced workers in and around Pasadena – California and also from any part of the United States of America as the business grows.
We will make sure that we take all the members of our workforce through the required training that will position them to meet the expectation of the company and to compete with leading booth rental salons in the United States and throughout the globe.
At Estee Jones® Booth Rental Salon®, Inc., our client’s best interest will always come first, and everything we do will be guided by our values and professional ethics. We will ensure that we hold ourselves accountable to the highest standards by meeting our client’s needs precisely and completely.
Estee Jones® Booth Rental Salon®, Inc. is owned by Estee Jones. A core professional with hands-on experience to run booth rental salon business.
3. Our Products and Services
Estee Jones® Booth Rental Salon®, Inc. was established with the aim of maximizing profits in the hair salon industry as a booth salon renter.
We want to compete favorably with the leading booth rental salons in the United States which is why we have but in place a competent team that will ensure that our booth rental salon facility meets and even surpass our customers’ expectations.
We will work hard to ensure that Estee Jones® Booth Rental Salon®, Inc. is not just accepted in Colorado Boulevard, Pasadena – California, but also in other cities in the United States of America where we intend opening our chains of booth rental salons.
Our products and services are listed below;
- Providing booth salon spaces for rentals
- Merchandise sales of hair salon related products
4. Our Mission and Vision Statement
- Our vision is to establish a standard and world class booth rental salon facility whose facility and brand will not only be accepted in Colorado Boulevard, Pasadena – California, but also in other cities in the United States of America where we intend opening our chains of booth rental salons.
- Our mission is to provide a standard booth rental salon that can attract some of the leading hairstylists, barbers and similar businesses who may not want to shoulder the responsibilities of owning a standard salon facility. We want to build a booth rental salon brand that can favorably compete with other leading brands in the hair salon industry cum booth rental line of business.
Our Business Structure
Estee Jones® Booth Rental Salon®, Inc. is a booth rental salon company that intends starting small in Colorado Boulevard, Pasadena – California, but hope to grow big in order to compete favorably with leading booth rental salons in the industry both in the United States and on a global stage.
We are aware of the importance of building a solid business structure that can support the picture of the kind of world class business cum brand we want to own. This is why we are committed to only hire the best hands within our area of operation.
We will ensure that we hire people that are qualified, hardworking, creative, customer centric and are ready to work to help us build a prosperous business that will benefit all the stakeholders.
As a matter of fact, profit-sharing arrangement will be made available to all our senior management staff and it will be based on their performance for a period of five years or more as agreed by the board of trustees of the company. In view of the above, we have decided to hire qualified and competent hands to occupy the following positions;
- Chief Executive Officer
- Booth Rental Salon Manager
- Human Resources and Admin Manager
- Sales and Marketing Executive
- Facility Manager
- Client Service Executive
5. Job Roles and Responsibilities
Chief Executive Officer – CEO:
- Increases management’s effectiveness by recruiting, selecting, orienting, training, coaching, counseling, and disciplining managers; communicating values, strategies, and objectives; assigning accountabilities; planning, monitoring, and appraising job results; developing incentives; developing a climate for offering information and opinions; providing educational opportunities.
- Responsible for fixing prices and signing business deals
- Responsible for providing direction for the business
- Creates, communicates, and implements the organization’s vision, mission, and overall direction – i.e. leading the development and implementation of the overall organization’s strategy.
- Responsible for signing checks and documents on behalf of the company
- Evaluates the success of the organization
Booth Rental Salon Manager:
- Serves as project manager of the organization; works directly with employees
- Builds company image by collaborating with customers, government, community organizations, and employees; enforcing ethical business practices
- Maintains quality service by establishing and enforcing organization standards
- Ensures that the organization works in line with international best practices
Human Resources and Admin Manager
- Responsible for overseeing the smooth running of HR and administrative tasks for the organization
- Designs job descriptions with KPI to drive performance management for clients
- Regularly hold meetings with key stakeholders to review the effectiveness of HR Policies, Procedures and Processes
- Maintains office supplies by checking stocks; placing and expediting orders; evaluating new products
- Ensures operation of equipment by completing preventive maintenance requirements; calling for repairs
- Defines job positions for recruitment and managing interviewing process
- Carries out induction for new team members
- Responsible for training, evaluation and assessment of employees
- Responsible for arranging travel, meetings and appointments
- Oversee the smooth running of the daily office activities
Sales and Marketing Manager
- Manages external research and coordinate all the internal sources of information to retain the organizations’ best customers and attract new ones
- Models demographic information and analyze the volumes of transactional data generated by customer
- Identifies development opportunities; follows up on development leads and contacts; participates in the structuring and financing of projects
- Writes winning proposal documents, negotiate fees and rates in line with organizations’ policy
- Responsible for handling business research, market surveys and feasibility studies for clients
- Responsible for supervising implementation, advocate for the customer’s needs, and communicate with clients
- Develops, executes and evaluates new plans for expanding increase sales and ensuring that all our salon booth spaces are rented out
- Creates new markets cum businesses for the organization
- Empowers and motivates the sales team to meet and surpass agreed targets
- Responsible for preparing financial reports, budgets, and financial statements for the organization
- Provides managements with financial analyses, development budgets, and accounting reports; analyzes financial feasibility for the most complex proposed projects; conducts market research to forecast trends and business conditions.
- Responsible for financial forecasting and risks analysis.
- Performs cash management, general ledger accounting, and financial reporting for one or more properties.
- Responsible for developing and managing financial systems and policies
- Responsible for administering payrolls
- Ensures compliance with taxation legislation
- Handles all financial transactions for the organization
- Serves as internal auditor for the organization
- Responsible for making sure that buildings (salon booths) and our services meet the needs of the people that work in them
- Supervising multi-disciplinary teams of staff including cleaning, maintenance, grounds and security
- Ensures that basic facilities such as water and heating, are well-maintained
- Allocating and managing space between buildings
- Ensures that facility meets government regulations and environmental, health and security standards
- Advises businesses on increasing energy efficiency and cost-effectiveness
- Overseeing building projects, renovations or refurbishments
- In charge of services such as cleaning, security and parking, to make sure the surrounding environment is in a suitable condition to work
Client Service Executive
- Welcomes clients and potential clients by greeting them in person or on the telephone; answering or directing inquiries.
- Ensures that all contacts with clients (e-mail, walk-In center, SMS or phone) provides the client with a personalized customer service experience of the highest level
- Through interaction with clients on the phone, uses every opportunity to build client’s interest in the company’s products and services
- Manages administrative duties assigned by the Human Resource and Admin Manager in an effective and timely manner
6. SWOT Analysis
Estee Jones® Booth Rental Salon®, Inc. engaged the services of a core professional in the area of business consulting and structuring to assist our organization in building a well – structured booth rental salon business that can favorably compete in the highly competitive hair salons industry in the United States and the world at large.
Part of what the consultant did was to work with the management of our organization in conducting a comprehensive SWOT analysis for Estee Jones® Booth Rental Salon®, Inc. Here is a summary from the result of the SWOT analysis that was conducted on behalf of Estee Jones® Booth Rental Salon®, Inc.;
Our core strength lies in the power of our team. We have a team of certified, creative and highly trained and experience workers, a team with excellent qualifications and experience in the booth rental salon line of business.
Aside from the synergy that exists in our carefully selected workforce, our services will be guided by best practices in the industry. Another strength that counts for us in the location of our booth rental salon; it is located in one of the most ideal locations for such business in Colorado Boulevard, Pasadena – California.
As a new booth rental salon in Colorado Boulevard, Pasadena – California, it might take some time for our booth rental salon to break into the market and gain acceptance especially from top profile clients in the already saturated and highly competitive hair salons industry; that is perhaps our major weakness.
Another weakness is that we may not have the required cash to pump into promoting our business the way we would want to.
No doubt, the opportunities in the booth rental salon line of business are massive considering the number of hairstylists and barbers in the United States who are embracing the option of cutting cost. As a booth rental salon company, we are ready to take advantage of any opportunity that is available in the industry.
Just like any other business, one of the major threats that we are likely going to face is economic downturn. Another threat that may likely confront us is the arrival of a new booth rental salon in same location where our target market exists and who may want to adopt same Business model like us.
7. MARKET ANALYSIS
- Market Trends
The fact that renting a booth in a salon can be a cost-effective for both the salon owner and workers makes it an ideal business model for hairstylists and barbers who just want to start small and grow big. This business model gives room for aspiring hairstylists and barbers to pitch their business in highbrow areas without necessarily breaking the bank.
All they need to do is to ensure that their services are top – notch and they won’t have to spend loads of cash maintaining the facility or marketing their services. It is the responsibility of the salon booth rental company to promote and maintain their salon booths.
Lastly, booth rental salon operators, in a bid to generate more revenue for their business engage in retailing hair products. They are also involved in rental of salon tools and equipment.
8. Our Target Market
Before starting our booth rental salon in Colorado Boulevard, Pasadena – California, we conducted a thorough market survey and feasibility studies and we are certain that there are loads of hairstylists, barbers, tanning and nail specialists et al who need small spaces in our booths to run their business.
Estee Jones® Booth Rental Salon®, Inc. will work towards providing services, facilities and environment that will help us reach out to our target market. In view of that, we have created strategies that will enable us reach out to various groups of people who we know will need our services. Below is a list of the people that we will specifically market our facility to;
- Manicure and pedicure specialists
- Tanning specialists
Our Competitive Advantage
Surviving in the business world as a booth rental salon company operator requires more than your expertise and creativity but also how to network with key people that matters; entrepreneurs that can rent your salon booths.
Because of the competitive nature of the booth rental salon line of business, there is an increasing degree of related business activities, with big players dominating the market. We are quite aware that to be highly competitive in the booth rental salon line of business means that you are not only expected to be able to make available top – notch and safe salon booths, but you must be able to meet set targets.
Our competitive advantage is anchored on the state of the art booth salon facility that we have. So also, we have a team of certified, creative and highly trained and experience workers. Aside from the synergy that exists in our carefully selected workforce, our services will be guided by best practices in the industry.
Another strength that counts for us is the location of our booth rental salon; it is located in a very busy area that is highly suitable for such business in Colorado Boulevard, Pasadena – California.
Lastly, all our employees will be well taken care of, and their welfare package will be among the best within our category in the industry. It will enable them to be more than willing to build the business with us and help deliver our set goals and achieve all our business aims and objectives.
9. SALES AND MARKETING STRATEGY
- Sources of Income
Estee Jones® Booth Rental Salon®, Inc. is established with the aim of maximizing profits in the booth rental salon line of business and we are going to go all the way to ensure that we do all it takes to meet and surpass the expectations of all our clients. Estee Jones® Booth Rental Salon®, Inc. will generate income by offering the following services;
- Providing booth salon space for rentals
- Merchandise sales of hair salon related products
10. Sales Forecast
One thing is certain, there would always be aspiring entrepreneurs /hairstylists, barbers and related business owners who would need to cut cost of starting the business hence the need to rent a small salon space in a booth rental salon facility.
We are well positioned to take on the available market in Pasadena – California and we are quite optimistic that we will meet our set target of generating enough income from the first six months of operation and grow our booth rental salon business to enviable heights.
We have been able to critically examine the booth rental salon market, we have analyzed our chances in the industry and we have been able to come up with the following sales forecast. The sales projections are based on information gathered on the field and some assumptions that are peculiar to similar startups in Pasadena – California.
Below are the sales projections for Estee Jones® Booth Rental Salon®, Inc. It is based on the location of our booth rental salon facility and of course our target market;
- First Fiscal Year: $120,000
- Second Fiscal Year: $350,000
- Third Fiscal Year: $750,000
N.B: This projection was done based on what is obtainable in the industry and with the assumption that there won’t be any major economic meltdown and there won’t be any major competitor offering same facility as we do within same location. Please note that the above projection might be lower and at the same time it might be higher.
- Marketing Strategy and Sales Strategy
Our marketing strategies will be directed towards achieving specific objectives that support the strategic goals of the organization. The truth is that all that we do will be geared towards creating new market channels, increasing sales and our market share.
Our unique selling proposition is that we are well positioned, we offer state-of-the-art facility, people can easily access our facility, and our various payment platforms are highly reliable.
Our sales and marketing team will be recruited based on their vast experience and they will be trained on a regular basis so as to be well equipped to meet their targets and the overall business goal of Estee Jones® Booth Rental Salon®, Inc.
Our corporate goal is to grow Estee Jones® Booth Rental Salon®, Inc. to become one of the top 10 booth rental salon brands in the United States of America which is why we have mapped out strategies that will help us take advantage of the available market and grow to become a major force to reckon with not only in Pasadena – California but also in other cities in the United States of America where we intend opening our chains of booth rental salon facilities.
Estee Jones® Booth Rental Salon®, Inc. is set to make use of the following marketing and sales strategies to attract clients;
- Open our booth rental salon business with a big party
- Advertise our booth rental salon business on national dailies, local TV and radio stations
- Promote our booth rental salon business online via our official website and all available social media platforms
- Introduce our business by sending introductory letters alongside our brochure to hair stylists, barbers, tanning specialists and manicure and pedicure specialists and key stake holders in Pasadena – California
- Print out fliers and business cards and strategically drop them in offices, sport facilities, libraries, public facilities and train stations et al.
- Make use of attractive hand bills to create awareness and also to give direction to our booth rental salon facility
- Adopt direct mailing coupon marketing approach
- Position our signage/flexi banners at strategic places in and around Pasadena – California
11. Publicity and Advertising Strategy
We have been able to work with our brand and publicity consultants to help us map out publicity and advertising strategies that will help us walk our way into the heart of our target market.
We are set to become the number one choice for hairstylists, barbers, tanning, manicure and pedicure specialists in the whole of Pasadena – California and other cities in the United States of America where we intend opening our chains of booth rental salons which is why we have made provisions for effective publicity and advertisement of our business.
Below are the platforms we intend to leverage on to promote and advertise Estee Jones® Booth Rental Salon®, Inc.;
- Place adverts on both print (newspapers and magazines) and electronic media platforms
- Leverage on the internet and social media platforms like Instagram, Facebook, twitter, YouTube, Google + et al
- Install our billboards in strategic locations all around Pasadena – California
- Distribute our fliers and handbills in target areas
- List our booth rental salon business in local directories/yellow pages
- Advertise our booth rental salon in our official website and employ strategies that will help us pull traffic to the site.
- Ensure that all our staff wear our branded shirts and all our vehicles are well branded with our company logo et al.
12. Our Pricing Strategy
Our pricing system is going to be based on what is obtainable in the industry, we don’t intend to charge more (except for premium and customized facility and services) and we don’t intend to charge less than what our competitors are charging their clients in Pasadena – California and throughout the United States.
Be that as it may, we have put plans in place to offer discount services once in a while. The prices of our services will be same as what is obtainable in the United States’ booth rental salon facility open market.
- Payment Options
The payment policy adopted by Estee Jones® Booth Rental Salon®, Inc. is all inclusive because we are quite aware that different customers prefer different payment options but at the same time, we will ensure that we abide by the financial rules and regulation of the United States of America.
Here are the payment options that Estee Jones® Booth Rental Salon®, Inc. will make available to her clients;
- Payment via bank transfer
- Payment with cash
- Payment via Point of Sale Machine (POS)
- Payment via online bank transfer
- Payment via check
- Payment via bank draft
In view of the above, we have chosen banking platforms that will enable our client make payment for renting our salon booth facility without any stress on their part. Our bank account numbers will be made available on our website and promotional materials.
13. Startup Expenditure (Budget)
In setting up any business, the amount or cost will depend on the approach and scale you want to undertake. If you intend to go big by renting a place, then you would need a good amount of capital as you would need to ensure that your facility is conducive enough for workers to be creative and productive. This is what it would cost us to set up Estee Jones® Booth Rental Salon®, Inc. in the United of America;
- The total fee for registering the business in the United States of America – $750
- Legal expenses for obtaining licenses and permits – $1,500
- Marketing promotion expenses (8,000 flyers at $0.04 per copy) for the total amount of – $10,000
- The total cost for hiring Business Consultant – $5,000
- The amount needed for the purchase of insurance policy covers (general liability, workers’ compensation and property casualty) coverage at a total premium – $30,800
- The total cost for the purchase of accounting software, CRM software and Payroll Software – $3,000
- The total cost for leasing facility for the business – $150,000
- The total cost for facility remodeling to fit into the type of booth rental salon facility – $80,000
- Other start-up expenses including stationery – $1000
- Phone and utility deposits – $3,500
- Operational cost for the first 3 months (salaries of employees, payments of bills et al) – $40,000
- The cost for the purchase of furniture and gadgets (Computers, Printers, Telephone, TVs, Sound System, snooker board, tables and chairs et al) – $4,000.
- The cost of launching a Website – $600
- The cost for our grand opening party – $15,000
- Miscellaneous – $5,000
Going by the report from the market research and feasibility studies conducted, we will need about three hundred and fifty thousand (350,000) U.S. dollars to successfully set up a medium scale but standard booth rental salon business in the United States of America.
Generating Startup Capital for Estee Jones® Booth Rental Salon®, Inc.
No matter how fantastic your business idea might be, if you don’t have the required money to finance the business, the business might not become a reality. Finance is a very important factor when it comes to starting a booth rental salon.
Estee Jones® Booth Rental Salon®, Inc. is a private business that is solely owned and financed by Ms. Estee Jones and her partner. They do not intend to welcome any external business partner which is why he has decided to restrict the sourcing of the startup capital to 3 major sources.
Since they are the sole financier of the business, they have decided to adopt the following means to generate startup capital for the business;
- Generate part of the startup capital from personal savings
- Source for soft loans from family members and friends
- Apply for loan from the Bank
N.B: We have been able to generate about $150,000 (Personal savings $100,000 and soft loan from family members $50,000) and we are at the final stages of obtaining a loan facility of $200,000 from our bank. All the papers and documents have been signed and submitted, the loan has been approved and any moment from now our account will be credited with the amount.
14. Sustainability and Expansion Strategy
One of our major goals of starting Estee Jones® Booth Rental Salon®, Inc. is to build a business that will survive off its own cash flow without the need for injecting finance from external sources once the business is officially running.
We know that one of the ways of gaining approval and winning customers over is to lease our state of the art salon booths a little bit cheaper than what is obtainable in the market and we are well prepared to survive on lower profit margin for a while.
Estee Jones® Booth Rental Salon®, Inc. will make sure that the right foundation, structures and processes are put in place to ensure that our staff welfare are well taken of. Our company’s corporate culture is designed to drive our business to greater heights and training and retraining of our workforce is at the top burner.
We know that if that is put in place, we will be able to successfully hire and retain the best hands we can get in the industry; they will be more committed to help us build the business of our dreams.
- Business Name Availability Check: Completed
- Business Incorporation: Completed
- Opening of Corporate Bank Accounts various banks in the United States: Completed
- Opening Online Payment Platforms: Completed
- Application and Obtaining Tax Payer’s ID: In Progress
- Securing a standard facility and reconstructing the facility to fit into the kind of booth rental salon facility we want to manage: Completed
- Application for business license and permit: Completed
- Purchase of Insurance for the Business: Completed
- Conducting Feasibility Studies: Completed
- Generating part of the startup capital from the founders: Completed
- Writing of Business Plan: Completed
- Drafting of Employee’s Handbook: Completed
- Drafting of Contract Documents: In Progress
- Design of Logo for the business: Completed
- Graphic Designs and Printing of Promotional Materials: Completed
- Recruitment of employees: In Progress
- Purchase of the needed furniture, office equipment, software applications, electronic appliances and facility facelift: In progress
- Creating official website for the business: In Progress
- Creating Awareness for the business: In Progress
- Health and Safety and Fire Safety Arrangement: In Progress