Do you want to start a tanning salon business and want to know the cost? If YES, here is a cost breakdown to open a tanning salon and the profit margin / ROI. The tanning salon industry includes companies that provide indoor tanning services through UV tanning beds and booths, as well as spray-on tanning services. Some operators in this industry are also involved in running complimentary services such as health spas, fitness centers, mobile tanning locations, beauty parlors and hair salons et al.
Research conducted by IBISWORLD shows that Ultraviolet (UV) tanning generates about 50.9 percent of the industry’s revenue. UV tanning can be done in tanning beds or in tanning booths. One advantage of tanning booths is that they take up less space; typically 10 to 15 square feet, which is about half the room needed for a tanning bed.
As a result of this, companies can install a greater number of units and maximize their number of customers. Furthermore, tanning booths are sometimes preferred because they are more hygienic. Tanning booths or beds are outfitted with fluorescent lamps that emit UV in a similar spectrum as the sun. The average session lasts between 10 and 20 minutes.
The tanning salons industry is very open to any aspiring entrepreneur who has acquired the required training, skills and perhaps professional certifications to start his or her own business. Just ensure that your salon is located in an environment with the right demography and you will be fine.
The Estimated Cost Breakdown to Open a Tanning Salon
When it comes to opening a tanning salon, the major areas that you should look towards spending the bulk of your cash is in renting or leasing a standard facility, converting it into a tanning salon and equipping the salon with the needed UV tanning equipment, Spray – On tanning equipment, tanning airbrush, Computers and receipt issuing machines, Sound System (For playing music), Point of Sale Machines (POS Machines), CCTV Cameras and Flat Screen TVs.
Aside from that, you are not expected to spend much except for paying of your employees and utility bills and stocking up on inventory. These are the key areas where you are expected to spend your startup capital on;
- The total fee for registering the business in the united states of America – 0.
- Legal expenses for obtaining licenses and permits as well as the accounting services (software, P.O.S machines and other software) – $3,300.
- Marketing promotion expenses for the grand opening of the tanning salon in the amount of $3,500 and as well as flyer printing (2,000 flyers at $0.04 per copy) for the total amount of $3,580.
- The total cost for hiring a business consultant including writing a business plan – $2,500.
- The total cost for the purchase of insurance (general liability, workers’ compensation and property casualty) coverage at a total premium – $2,400.
- The cost for renting or leasing a space or warehouse that will be converted into the tanning salon and that can accommodate the number of customers per time (Re – construction of the facility inclusive) will cost – $80,000.
- Other start-up expenses including, commercial satellite TV subscriptions, stationery ($500) and phone and utility deposits ($2,800).
- Operational cost for the first 3 months (salaries of employees, payments of bills et al) – $40,000
- The cost for start-up inventory (stocking with amino acid tyrosine to produce melanin and other related tanning supplies) – $15,000
- The cost for the purchase of storage hardware (bins, rack, shelves, case) – $3,720
- The cost for counter area equipment (counter top, receipt issuing machine, etc.) – $9,500
- The cost for store equipment (cash register, security, ventilation, signage) – $4,750
- The cost of purchase and installation of CCTVs: $2,000
- Equipping the tanning salon with (vertical solarium tanning bed / tanning machine / solarium device with 48pcs Germany UV lamp tubes, furniture (table, stools and sofas), telephones, filing cabinets and TV et al) will cost – $80,000
- The cost of launching a website: $600
- Miscellaneous: $2,000
From the rough estimate as listed above, you would need a minimum of two hundred and ninety – eight thousand nine hundred USD ($298,900) to establish a medium – scale but standard tanning salon business in any city in the United States of America. Please note that this amount includes the salaries of all the staff for the first three months of operation.
Please note that this is a rough estimate and we usually advise our readers who are interested in opening a tanning salon to go to the market or directly contact wholesalers and suppliers of the types of vertical solarium tanning bed/tanning machine, UV lamp tubes, flat screen TVs, sound system and related gadgets they want to have in their tanning salon in order to get the real time prices of these items.
The truth is that, if you are a good bargainer, you can get a better deal that will help you beat down the estimated price as listed above.
Frequently Asked Questions
What Are The Goals Of A Tanning Salon?
- Reduce the Risk of Skin Cancer
- Help Clients Produce Vitamin D
- Hormonal Balance and Oil Production
- Reduce Scar/Stretch Marks Visibility
- Reduce the Visibility of Jaundice Skin
- Weight Loss
Why Should You Consider Opening A Tanning Salon?
First and foremost, the tanning salon industry is huge. According to IBISWorld, the market size of tanning salons is worth $4 billion, and there are 19,535 tanning businesses in the country. While COVID-19 has slowed down the growth of tanning businesses due to their non-essential nature, experts maintain that the industry will bounce back once the world has recovered from the pandemic.
What Is The Growth Potential For A Tanning Salon?
In the United States, tanning salons remain small, serving those in their community. Industry revenue is expected to grow amid rebounding consumer spending, which will trigger higher spending on discretionary products and services, such as tanning salons and merchandise.
Also, increased consolidation is projected among industry players, particularly as companies expand product and service offerings to become more similar to day spas, which will help diversify the customer base.
What Happens During A Typical Day At A Tanning Salon?
As the owner of a tanning salon, note that your biggest task will be to interact with clients. Both personally and online, you’ll have to educate consumers regarding a healthy skin care regimen and to dispel any myths regarding tanning bed safety.
Also note that the tanning beds will need to be maintained and salon product inventory should be kept up. Since the business can be seasonal, you’ll also need to spend part of each day analyzing and tweaking your marketing strategy to ensure you reach your target audience year round.
How Much Can You Potentially Make Owning A Tanning Salon?
The income generated by a tanning salon rely on various factors, including the number of tanning beds or spray tanning stations it has, the salon’s location, and its years in business. Indeed.com reports the average income of a tanning salon owner to be $30,000, but remember that this will vary from business to business.
What Are The Costs Involved In Opening A Tanning Salon?
The cost to start a tanning salon depends on factors like the salon’s size and whether the salon will feature tanning beds or spray tanning. But generally, the costs involved will include;
- Tanning beds
- Spray tanning booths
- Renovations so that the building can support the electrical use of equipment
- Furniture for the waiting room and reception area
- Shelves for retail product
- Waiting room and changing room furniture and décor
- Supplies like towels, lotions, and eye protection
- Working capital to cover the first few months of payroll, rent, utilities, etc.
How Does A Tanning Salon Make Money?
Note that revenue from a tanning booth is generated on a per client, per visit basis. Many salons have multiple beds and/or spray tan options available and are priced accordingly. Visits last up to 15 minutes per session and will vary based on the client’s specific needs.
Do You Have To Wear Protective Eyewear?
Yes, it is imperative that the eyewear be worn at all times during the tanning session. Overexposure to UVA and UVB light can cause damage to the physical structure of the eyes, and can cause swelling, redness, and loss of colour perception.
What Are The Ongoing Expenses For A Tanning Salon?
Your energy bill will be one of your biggest ongoing expenses. Salon owners report paying anywhere from $500 – $1500 a month. However, the amount will depend upon the time of year, how many beds you own, and how busy you are. Payroll and payroll taxes are also a major expense, which will fluctuate seasonally with the business.
Budget for at least $200 per month for cleaning and maintaining the beds, retail products will set you back another $1,000 per month. If you decide to do spray tans rather than tanning beds, your inventory costs will be higher, but can be offset by a lower energy bill.
Which Tanning Salon Franchise Is Best?
- Palm Beach Tan
- Tan Republic
- The Tan Company
- iTan Franchising
- South Beach Tanning Company
- The Palms Tanning Resort
Should You Hire A Tanning Consultant?
Definitely, the duties of a tanning consultant include scheduling appointments, signing in clients, cleaning the tanning beds and rooms, selling products like eyewear, lotions, and swimwear, and answering customer questions.
Do You Need A Tanning Facility License?
Although requirements vary from one municipality to another, but business owners who plan to operate a tanning salon, health club, apartment or condominium complex that includes one or more tanning bed need to have a tanning facility license.
What Are Some Skills And Experiences That Will Help You Build A Successful Tanning Salon?
- Knowledge of tanning and skin care
- Customer service experience
- Attention to detail
- Marketing skills
How Much Does It Cost To Start A Tanning Salon Franchise?
Around $50,000 to $170,000 in initial investment
What Type Of Tanning Bed Should You Use?
A Level 1 tanning bed is an economic option, but they produce high levels of UVB rays, the rays that can cause sunburn if not used properly. If you love the experience of relaxing in a tanning bed, Level 1 tanning beds are the perfect choice for you.
How Much Profit Can A Tanning Salon Make?
Have it in mind that the profit of a tanning salon is directly tied to the number of beds you maintain and how often those rooms are filled. On average, each room should generate around $12,000 – $15,000 annually.
Note that each visit will cost you $6 – $9 in supplies and energy costs. Some salon owners report making upwards of $58,000 in profit, while others claim to have very little left after business and personal expenses.
What Type Of Tanning Lotion Should You Use?
Accelerator and maximizer tanning lotions are often the best choice for those who are new to indoor tanning. These lotions contain more moisturizers than other lotions, so they help to keep the skin hydrated as it adjusts to the tanning process.
How Many Beds Or Spray Tan Stations Should You Have?
This will depend on your business capital and the space you have available. However, remember that tanning beds are quite large, regardless of make and model. Most standard beds lay between 7 and 8 feet in length and are between 32 and 46 inches wide.
Who Is The Target Market?
Have it in mind that the target market for a tanning salon can vary according to a salon’s location and branding. In most instances, tanning salons target adult women (18-60) who value their appearance and who have enough disposable income to afford tanning services. College students and, on occasion, high school students may also be part of the target market, depending on state regulations allowing this age bracket to use the equipment legally.
How Do You Register Your Business Name?
The three ways a business may register a name are:
- Form a business entity, such as a corporation or limited liability company (LLC).
- Register the business name as an assumed name or DBA (“doing business as”).
- Register the business name as a federal trademark.
Should I Use An LLC Formation Service Or Do It Myself?
It is advisable to use an LLC formation service, especially because a formation service simplifies the process and helps walk you through forming an LLC. These services do this day in and day out, so they know the process and are available to answer any questions you may have along the way.
Who Is This Business Right For?
For individuals who are passionate about helping people maintain that “summer glow,” a tanning booth can be a lucrative business venture.
How Can You Make Your Business More Profitable?
If you’re looking to increase your business’ profits, consider including the following in your business strategy:
- Stock your shelves with skincare and tanning products
- Become certified
- Offer both airbrush tan and UV tanning
- Offer a mobile service for spray tanning
- Set up membership options, with each tier offering different incentives
- Offer additional spa services. If customers only have to go one place for multiple services, they’re more likely to return