Skip to Content

How Much Do Nail Salons Make Yearly? [Profit Margin]

Nail Salon Business

Do you want to know how much money nail salons make yearly? If YES, here are 7 factors that determine the income & profit margin for nail salon business owners.

In order to have an idea of the amount a nail salon owner is expected to make daily, weekly, monthly or yearly, you should clearly define the services that nail salons offer. A nail salon or nail bar is a specialty beauty establishment that primarily offers nail care services such as manicures, pedicures, nail enhancements and sale of nail accessories such nail polish, nail polish remover, artificial nails et al.

So, with that in mind, we can estimate what a nail salon that offers the services listed above is expected to make. Nail Salon Owners make $58,000 per year on average.

Average Salary for Nail Salon Owners

Nail Salon Owner salary ranges from $40,000 to $75,000 per year. Salary varies depending on the salon’s location and how well managed the business is.

The states and districts that pay Nail Technicians the highest mean salary are Minnesota ($37,170), New Hampshire ($34,160), Iowa ($34,010), Idaho ($32,870), and South Carolina ($32,490). Over and above, it is important to point out that there is no one-mold-fits-all when it comes to how much a nail salon owner is expected to make.

There are some factors we are going to look into before giving an estimate of how much the average nail salon owner makes yearly and these factors are;

7 Factors That Determine How Much Money Do Nail Salons Make Yearly

1. The Size of the nail salon

No one can conveniently state the amount a nail salon owner is expected to make yearly if you do not know the size of the nail salon and the number of customers the nail salon can accommodate per session.

A nail salon that operates from a small shop is expected to make far less than a nail salon that operates from a standard facility or booth facility. If your nail salon is large enough, it can accommodate more workers and customers and that will mean increase revenue.

2. The Location the Nail Salon

We must not rule out the fact that the location of a nail salon is a major factor that will determine the amount the nail salon owner is expected to earn monthly. If a nail salon is located in a highbrow area, an area with the right demography and lifestyle and of course people who have the financial means (purchasing power), then the owner of the nail salon is expected to make more money.

The truth is that you will struggle to make good money from your nail salon if you locate the business in an area filled with low income earners or in a ghetto or a place where the residents are busy working – class people who don’t have time for manicure and pedicure.

3. The Type of Services Available in the Nail Salon

Another important factor that will determine how much a nail salon owner is expected to make yearly is the type of services offered by the nail salon.

You will agree that a nail salon that offers robust services that covers manicures, pedicures, nail enhancements, sale of nails accessories and artificial nails et al and spa services will earn much higher than a nail salon that offers only manicure and pedicure services.

4. The Management Style of the Nail Salon Business

Another key factor that will determine the amount a nail salon owner is expected to make yearly is the management style of the owner. Trust me, the results you will get when you are a good manager will definitely differ from a nail salon owner with poor management skills.

5. The Business Approach of the Nail Salon 

There are different business approaches that a nail salon owner can choose from and no doubt it will greatly influence the amount they are expected to make monthly and yearly.

A nail salon owner may decide that they want to operate only one location and do their marketing alone, and another salon may decide to go into franchising and also partner with other businesses that will recommend clients to them. It is easier to find nail salons that operate franchises and also offers partnerships with hotels, luxury spas, beauty pageant organizers and celebrity managers et al make more money.

In essence, a well – organized nail salon that works with others will surely make more money than a nail salon that only operates from one location.

6. The Advertising and Marketing Strategies Adopted by the Nail Salon 

Another key factor that will determine the amount a nail salon owner can make yearly is the advertising and marketing strategies adopted by the salon. Trust me, there are several advertising and marketing strategies that can help a business increase their earnings.

But the results you will make will far outweigh the amount you spent on advertising and marketing. Of course, you don’t expect a nail salon owner that engages in aggressive advertising to make same amount yearly with a nail salon owner that is passive with its advertising.

7. The Number of Years the Nail Salon is in Existence

Another key factor that will determine the amount a nail salon owner is expected to make on a yearly basis is the number of years the nail salon is in existence. In business, the number of years you are in existence will go a long way to determine the amount you will make especially if the business is well – managed.

For example, in your first fiscal year (FY1) you might make fifty thousand dollars (50,000), in your second fiscal year (FY2) you might make sixty thousand dollars ($60,000) and in your third fiscal year (FY3) you might make eighty – five thousand dollars ($85,000).

The Estimated Profit Margin of a Nail Salon

In order to calculate the profit margin of a standard nail salon, you should be able to place a figure on the recurring and ongoing costs of running the salon.

a. Recurring costs

These are the consistent expenses you’ll be seeing as your business grows. These are your day to day, month to month, and year to year costs of normal business operation. You can’t avoid them, so make sure to take the applicable ones into consideration.

b. Mortgage or lease payments

Whether you rent or buy, you’ll have a monthly payment to keep the doors open. Costs will vary greatly, but make sure to factor them into the budget.

c. Insurance

Insurance is typically calculated in annual premiums, though you may be able to split the payments by month. The average cost is $300 to $700 per year. As the owner, another potential factor is the provision of health insurance. Although rarely offered for stylists, you’ll have to factor this in if you want to provide your employees with this benefit.

d. Permits

Compliance permits often have renewal fees. Be sure to check with your locality for specifics.

e. Wages

Depending on your Business model, you may be paying a salary to each of your manicure and pedicure specialists. You could very well operate a commission-based model. This cost will range according to your employee payment structure. Also keep in mind that you, the owner, should be taking a salary too.

f. Payroll taxes or self-employment taxes

These fees accompany your wage expenses and will also vary according to your business model. Make sure you consider your employees’ particular situation, as well as your own, to determine the taxes you’ll owe. Keep in mind, these taxes often need to be paid quarterly. Self-employment taxes will amount to around 7.6 percent of individual sales.

g. Cleaning

Cleanliness is key not only for health compliance but for the general business image. Stay on top of regular housekeeping. Make sure to account for mops, vacuums, toilet paper, bleach, general purpose wipes, and access to laundry services.

Supplies may range from $50 to $200 per month. You can also go the route of hiring a professional cleaning crew periodically. For a professional service, you’re looking at about $200 per visit, although you and your staff will still be responsible for the day-to-day upkeep.

h. Equipment lease payments

If you choose to go the route of leasing your nail salon equipment, factor these monthly costs into your budget. They will vary depending on your particular lease agreement.

i. Utilities

Electric, gas and water bills will vary by the kind of equipment your salon is running. Expect $640 to $4,000 per month here. The high end more accurately reflects salons with multiple big screen TVs, lighted decor and various other energy-guzzling pieces of equipment. Most salons find their utilities costs fall on the lower end of that spectrum.

j. Credit card processing fees

Here’s a potentially sneaky expense. As a modern business, you’ll want to accept credit card payments. Standard industry base rates for processing fees range from 1.5 percent to 2 percent. But many salons end up paying more than 3 percent, so be careful and shop around for your provider.

k. Repairs and maintenance

Normal wear and tear takes its toll and equipment often breaks. You’ll need to factor in the costs of routine maintenance. Expect up to $500 per month.

l. Marketing

You’ll need to get the word out about your operation to drum up clientele. There are a number of avenues you can take (print, broadcast, web, social advertising), all with different price tags. You could spend as little as $20 for an email marketing solution or upwards of $4,100 for more robust advertising campaigns.

m. Legal and professional fees

This is a fluctuating expense, as it depends on your particular business model. Just keep in mind that professional services such as accounting or legal typically run about $200 an hour.

n. Miscellaneous expenses

You never know what problems may arise. It is always a smart idea to budget in some funds for miscellaneous expenses. We suggest at least $500 per month.

Generally Speaking, you can expect to receive higher payment and profit margin by working in more luxurious locations, such as a spa, because they charge clients a higher price for manicures and pedicures. The highest paid industry for nail technicians was in traveler accommodation, which had an average pay of $13.40 an hour.

In essence, the profit margin of operating a nail salon will range from 15 percent to up to 50 percent, all things been equal.